The New York State Department of Labor (NY DOL) has issued proposed regulations and guidance to convey information on the state’s new salary disclosure law, effective as of September 17, 2023, and its key compliance areas, including updates to requirements for advertisements, job descriptions, and salary ranges, among others.

As we have previously reported, New York State enacted, and later amended, its salary disclosure law, creating a statewide salary disclosure requirement effective September 17, 2023. The salary disclosure law applies to employers with four or more employees in New York when advertising a job, promotion, or transfer opportunity.

Much like the New York City salary disclosure law, employment advertisements must disclose the “compensation or range of compensation” for a position. Unlike the New York City law, however, companies must also attach or link a job description, if the company has created one for the relevant position, to each job advertisement.

KEY TAKEAWAYS AND ANALYSIS

On September 13, 2023, just four days before the salary disclosure law went into effect, the NY DOL issued proposed regulations (the Proposed Regulations) providing guidance on compliance with this law. While the Proposed Regulations largely track the law itself, they important provide further clarity on the salary disclosure law’s requirements.

These regulations are subject to a notice and comment period through November 13, 2023 and will not become final until December 2023 or January 2024 at the earliest. Additionally, on September 15, 2023, the last business day before the law went into effect, the NY DOL published a new salary disclosure website, which includes more information on the NY DOL’s interpretation of the law as well as a fact sheet and FAQs.

One of the significant areas of ambiguity has been the geographic scope of the law. The guidance states that the law applies to positions that will be performed at least in part in New York “including an opportunity that will physically be performed outside of the state of New York but reports to a supervisor, office, or other work site in the state of New York.” This language mirrors the text of the law and means that a position based in another state is still covered by the law if it will report to a supervisor based in New York.

The one exception to this requirement, explained in the NY DOL’s FAQs, is if the supervisor is working remotely from home in New York, but the company is not based in New York and the leadership team and offices are not in New York. In other words, if the position’s supervisor is only working in New York out of convenience to that person, but the company is effectively based outside the state, then the position would not be covered by this law.

Helpfully, the proposed regulations and guidance both state that “[i]ncidental or infrequent instances of being physically present in the state of New York for work-related purposes, such as for an occasional meeting or conference, or mere communication with employees based in the state of New York, shall not alone be deemed physically performing an opportunity ‘in part’ in the state of New York.” This language confirms that the law does not broadly cover non–New York positions merely because of an occasional required presence in New York.

Additionally, the Proposed Regulations and guidance convey additional information on other key compliance areas, including the following:

Covered Advertisements

An “advertisement” must include a compensation range regardless of the medium in which it is posted (e.g., newspaper, flyer, social media post, email) as long as it is made available to more than one potential or prospective applicant at a time. The Proposed Regulations also note that advertisements are otherwise covered if posted by a third-party agent of an employer, such as a recruiter or job-listing website. Employers are not responsible for advertisements that are posted by a third party without their consent.

Job Descriptions

Under the law, an advertisement must include a job description if a job description exists. This requirement is unique to the New York State law and is not a requirement under the New York City law. The Proposed Regulations clarify that a job description is not required if the company has not created one for the position or in the limited circumstance where the title clearly conveys the duties required of the position without the need for additional detail. The Proposed Regulations list a dishwasher as an example of this type of position.

Compensation Range

A posting need only provide the minimum and maximum of the intended base pay and not other forms of compensation (e.g., commission, bonuses, benefits) regardless of pay frequency. To the extent there is no flexibility in the pay being offered, the exact rate being offered must be stated in the posting (e.g., Pay Rate: $25/hour). Note that the law is already explicit in that commission-based employee job descriptions need only include “a general statement that compensation shall be based on commission.”

“Good Faith” Range

The Proposed Regulations define good faith as “the range of compensation the employer legitimately believes they are willing to pay the successful applicant or employee at the time they post an advertisement.”

The Proposed Regulations provide an example of “good faith” as “where an employer considers factors such as the job market, current employee compensation levels, hiring budget, and experience and education levels acceptable for the opportunity; determines the legitimate range of compensation that they are willing to pay the successful applicant or employee for the opportunity; and includes this range in the advertisement.”

Adjustments of “Good Faith” Range

The Proposed Regulations helpfully confirm that “good faith” is determined as of the time of the posting. While companies can adjust the actual salary offered to a candidate outside of the posted range as well, the guidance explains that there should be a valid reason to do so.

The guidance lists as examples of permitted reasons to make such an adjustment when (1) an employer determines that it needs to increase its hiring budget to attract qualified candidates, (2) an applicant exceeds the expected qualifications for a position, or (3) an employer institutes a companywide increase in pay that also causes the posted range of compensation to increase.

There is no posting requirement for subsequent adjustments to a role unless the position remains open. In contrast, the guidance provides that a posted range is not in “good faith” where the range misrepresents the base pay or is so broad, without explaining the breadth, that it fails to provide a reasonable range.

Multiple Ranges

To the extent a posting is intended to cover multiple geographic locations or include multiple levels of seniority or supervisory authority, a specific range of compensation for each individual opportunity/location must be provided. For example, if two positions were advertised in a single posting, such as an analyst and associate, the posting should include the pay range for both positions.

Attachments

Where the range of compensation information is so extensive that it will not fit in the space allotted for the advertisement, the employer can provide wage range information and/or a job description in a separate link, attachment, or addendum, provided that the link, attachment, or addendum is available free of charge and is easily accessible to the prospective applicant, and the main body of the advertisement clearly and conspicuously states where the range of compensation information is available.

ENFORCEMENT

The Proposed Regulations confirm that the law is enforced exclusively by the NY DOL (e.g., there is no private cause of action) and that complaints can be made to the NY DOL by applicants, members of the public, and current employees. Penalties can be issued at up to $1,000 for an initial violation, up to $2,000 for a second violation, and up to $3,000 for subsequent violations.

New York City employers should note that the New York City salary disclosure law still permits current employees to bring a private cause of action regarding potential violations of the New York City law or to raise concerns with the New York City Commission on Human Rights. New York City employees may also make complaints regarding potential violations of the New York State law to the NY DOL.

NEXT STEPS

While potentially subject to change following the 60-day notice and comment period, the Proposed Regulations likely reflect the NY DOL’s priorities in enforcing the law. The NY DOL guidance that was issued immediately before the law taking effect largely reflects the language in the Proposed Regulations.

As the law is presently in effect, companies should review their current job postings to confirm whether they are compliant. The law is not limited to just new postings, so currently posted job advertisements may need to be modified to add a pay range or job description.

Further, employers (even those without traditional New York offices) should confirm whether they are advertising for positions that would be performed, at least in part, in New York or would be performed elsewhere but would report to a New York manager. Notably, Illinois’s recently passed salary disclosure law, described here, which takes effect on January 1, 2025, also applies to positions that are not based in Illinois but report to an Illinois-based supervisor.

Moreover, with the proliferation of salary disclosure laws across the country, including laws in New York City, California, Colorado, and Washington that apply to jobs that could be performed in those respective locations, employers should consider whether any advertisements that offer the ability to work remotely are covered by these laws.

Additionally, covered employers should consider

• determining the salary ranges for all currently posted positions that could be filled by a New York–based applicant;
• reviewing existing job posting templates and/or creating new templates;
• reviewing and updating job descriptions for roles before new advertisements are posted;
• training supervisors, managers, compliance personnel, human resources, and legal professionals on the implications of the new law—including with respect to appropriate communications with internal and external applicants;
• conducting a privileged pay equity audit to ensure alignment with external job postings; and
• monitoring for additional rulemaking and guidance from the NY DOL.

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