On April 28, 2022, the New York City Council (the “Council”) passed Int. 134, an amendment to New York City’s Salary Transparency Law (the “Salary Transparency Law” or “STL”) that finalized a number of significant changes to its requirements.  As we previously reported, the Council has been considering Int. 134 in various forms since March 24, 2022.  The original version of Int. 134, which provided more significant protections for employers, failed to gain traction.  Following discussions with pay equity advocates and the small business community, Int. 134’s sponsors announced modifications to Int. 134 designed to represent a compromise proposal.  That version of Int. 134 passed, and will be effective immediately if signed by Mayor Eric Adams.

Int. 134 makes a number of important changes to the Salary Transparency Law, which are summarized below.

Date for Compliance Now November 1, 2022

As originally drafted, the Salary Transparency Law amended the New York City Human Rights Law (“NYCHRL”) to require New York City employers with four or more employees (and at least one who works in New York City) to begin including the minimum and maximum salary range in any internal or external advertisement for a “job, promotion, or transfer opportunity” on May 15, 2022.  Int. 134 rolls back that date for compliance to November 1, 2022, giving employers additional time to prepare.

Both Annual Salaries and Hourly Wages Covered

The original version of the STL required employers to provide a position’s “minimum and maximum salary.”  Int. 134 clarifies that employers must articulate “the minimum and maximum annual salary or hourly wage,” and preserves the STL’s requirement that the range must encompass what the employer “in good faith believes at the time of the posting it would pay for the advertised job, promotion or transfer opportunity.”

Jobs That “Cannot or Will Not Be Performed” in NYC Excluded From Coverage

As written, the Salary Transparency Law applied to all job postings created by a covered employer.  Pre-amendment guidance issued by the New York City Commission on Human Rights (the “Commission”) stated that the STL applied to positions “that can or will be performed, in whole or in part, in New York City, whether from an office, in the field, or remotely from the employee’s home.” (emphasis added).  In its original iteration, Int. 134 proposed limiting the STL’s scope to roles that were “not required to be performed in New York” and excluded general calls for applications that did not specify a position from coverage, though neither limitation survived.  As passed, Int. 134 incorporates and modifies the Commission’s guidance, and expressly excludes from the STL’s coverage “positions that cannot or will not be performed, at least in part, in the city of New York.”

As a result, New York City employers do not appear to be required to include salary ranges in postings for positions that will definitively not be performed in New York City, such as office-based roles located outside the five boroughs.  For instance, a New York City employer hiring for an in-person role in its satellite office in Chicago would likely not be required to include a pay range in that advertisement.  However, advertisements for fully remote positions will be covered, as they could theoretically be filled by an employee who lives in New York City.  Likewise, positions that require periodic office attendance but could still possibly be filled by someone who lives in New York City (e.g., largely remote positions that require occasional attendance at an employer’s offices for meetings, or hybrid positions that require semi-regular attendance at an office within driving distance of New York City) also appear to be covered.  More guidance on the scope of this carve-out is anticipated.

Private Right of Action Sharply Curtailed

Importantly, Int. 134 provides significant protections to employers against needless or opportunistic litigation.  The Salary Transparency Law provides a private right of action for persons aggrieved by violations of the law, and originally contained no limitations.  As a result, any applicant who encountered a non-compliant job posting could have pursued a claim against the posting employer.  In response to concerns from the business community, Int. 134 limits that private right of action to a covered employer’s current employees, who may bring claims “in relation to an advertisement by their employer for a job, promotion, or transfer opportunity with such employer.”  However, the Commission may still pursue claims against non-compliant employers and seek fines and civil penalties in all circumstances.

No Penalty for First-Time Cured Violations

Violations of the Salary Transparency Law may result in civil penalties up to $250,000, which is the maximum penalty contemplated under the NYCHRL.  Int. 134 sets civil penalty for a first-time violation at $0, provided that the cited employer proves to the Commission that the violation has been cured to the Commission’s satisfaction within thirty (30) days of service of a complaint from the Commission.  The employer’s proof of cure may be submitted electronically or in person, and an employer may seek review of any Commission determination that a proof of cure was not submitted within fifteen (15) days of receipt of written notice of the determination.

Assuming Mayor Adams signs Int. 134, further guidance from the Commission regarding the scope and applicability of the STL is expected prior to its new November 1, 2022 effective date.  We will continue to monitor any new developments and provide updates as they become available.