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New Pay Transparency Laws: What They Mean Benefits for Employee Recruiting

During the recruiting process, there are a lot of issues to navigate for both the employer and candidate, and few are as sensitive as salary. Companies are being met with a workforce that asks about compensation upfront. Some rules require salary disclosure, like New York legislators have approved pay transparency laws. While the change takes getting used to, it could benefit recruiters.

What Are Transparency Laws?

Pay transparency laws have been around but are gaining more traction nationwide. They are legal requirements that ensure an employer shares accurate information about how much a job pays. That information can be a specific number or a range.

What Do They Mean?

In the complex world of the labor market, transparency laws can set clear expectations and make it easier to start conversations. They also help with fairness. Because wages or salary ranges are posted, every candidate can fill confident that they are being made an offer based on the value of the job and not a potentially hidden bias.

Transparency laws have an impact on the remote workforce as well. With the recent advancements in virtual work, many companies can hire workers who live hundreds of miles away. Thanks to pay transparency, candidates can see how salaries for similar roles compare in different parts of the nation, helping them to decide which companies may be good fits.

What Are The New Laws?

Pay transparency works in different ways in different places. The California pay transparency law requires employers to disclose salaries when a potential employee asks. An update to the law will require wages to be posted with a job listing. That rule will impact companies with 15 or more employees. Businesses must also share pay scale information when asked.

The Colorado pay transparency law goes a bit further. It also requires all companies to include salary information in every job listing, even if the company only has one employee. Businesses also need to keep records about job descriptions and wages for individual positions to ensure that salaries are based on the work and not on bias surrounding the candidates.

The pay transparency laws New York businesses have to adhere to force organizations to list salary ranges for open positions. Job posts can't be open-ended, with just a starting pay. Minimum and maximum pay information has to be included, or a set wage should be posted if the company doesn't have any wiggle room.

Businesses in states without pay transparency may have to comply with the rules when dealing with national job postings. For instance, a company in Georgia might need to list a salary if it advertises a job to people in Colorado.

Benefits of Them for Employee Recruiting

New rules around pay transparency can create more work for recruiting teams, but they also benefit companies looking for new workers. First, pay transparency allows businesses to see what their competition offers workers for similar roles. If a recruiter notices that their company is paying much less than other businesses in the industry, they can address the issue to get better candidates.

Pay transparency also prevents wasted time for both hiring managers and candidates. When a person knows the potential wage for a job, they are less likely to go through multiple interviews only to drop out because the salary needs to be higher. Companies can get more serious and focused applicants when they are upfront about compensation.

Embracing Pay Transparency in Recruiting

Today's job market is rapidly evolving, with workers taking more control of their careers and turning to companies that allow them to do so quickly. Pay transparency is an excellent start in the process, creating open conversations during the recruiting process, so it's wise for businesses to embrace the growing practice.


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