Ever applied for a job that didn’t advertise the salary, only to be disappointed when you discover it’s paying $10k below what you’re looking for?
Pay transparency is when an employer reveals the salary of a job they’re advertising to internal and external applicants, and it’s a growing trend across the US. It ensures pay equity, helps employees get paid what they’re worth, and helps businesses benchmark against their competitors.
Since 2018, more and more states are requiring employers to tell jobseekers what a job they’re applying to pays and it’s good news for jobseekers.
We uncover the “state of pay” in each state and why salary transparency is a trend that’s not going away.
Why is pay transparency so important?
Pay transparency evens the playing field for applicants and helps to achieve pay parity. Employees and applicants can check they’re fairly paid, and receive the same pay as other candidates with a similar set of skills and experience.
For those who are newly graduated, transitioning between industries, or upskilling into a more senior role, without an “in” you won’t know the going rates. Salary transparency can help reduce and remove bias, making things fairer for those less likely to advocate for themselves.
For businesses, salary transparency holds them to account, ensuring employees are being paid a fair market rate as they can benchmark pay against their competitors. As well as improving employee well-being and employee retention, this is especially important during the current skills shortage. As workers leave roles for better compensation, it’s important for companies to make sure that they’re not falling short.
For all states, the Equal Pay Act means that an employer can’t pay an employee less than another employee of a different race or sex for equal work.
Are there pay transparency laws in every state?
For 30 states, the Equal Pay Act is currently the only law in place.
For the other 20, there are further laws about pay transparency. In eight of these states, there is a basic tweak, such as prohibiting an employer from asking about a jobseeker’s salary history. In the other twelve states, these laws are more extensive. We’ll talk about these in more detail below.
The 38 states who have either the Equal Pay Act or a few small tweaks are:
- Alaska
- Arizona
- Arkansas
- Delaware: Employers are not allowed to ask job applicants about their salary history.
- Florida
- Georgia
- Hawaii: Employers are not allowed to ask job applicants for their salary history.
- Idaho
- Indiana
- Iowa
- Kansas
- Kentucky
- Louisiana: Legislation is currently advancing to allow employees to freely discuss their salary.
- Maine: Employers are not allowed to ask about salary history and employees are allowed to openly discuss their own and other employees’ wages.
- Michigan
- Minnesota: Employees are allowed to freely disclose their own wages.
- Mississippi: It became the last state to enact an equal pay law in July 2022.
- Missouri
- Montana
- Nebraska
- New Hampshire: Employees are allowed to freely discuss their wages, salary, and benefits.
- New Mexico
- North Carolina
- North Dakota
- Oklahoma
- Oregon
- Pennsylvania
- South Carolina: Has pay transparency laws in draft for a vote in 2023
- South Dakota
- Tennessee
- Texas
- Utah
- Vermont: Employers are not allowed to make salary history inquiries while employees are allowed to discuss their wages.
- Virginia
- West Virginia
- Wisconsin
- Wyoming
For the other 12 states, as we mentioned, the laws on salary transparency are progressing. These laws empower applicants who do not know a current employee or someone who would like to discuss their own rate of pay with others.
Here’s what you need to know.
California
California passed a mandatory pay transparency statute in 2018, becoming the first state to do so. The law requires Californian employers to provide external job applicants with the “pay scale” for the job they’re applying to on reasonable request.
From January 2023, employers with 15 or more employees are required to disclose salary bands in every job ad. Links to pay scales on a separate document or provision of a QR code are deemed insufficient and clarity is key. They also need to inform current employees of promotion opportunities, as well as disclose their pay scales upon request.
In September 2020, California passed the nation’s first state-level pay data reporting obligation. Companies with more than 100 employees must provide the number of employees by race, ethnicity, and sex, categorized within 10 job categories and by their pay band. Also from the beginning of this year is the even more rigorous Senate Bill 1162, imposing a monetary penalty (per employee) for companies failing to report pay data. These changes will also allow the state to publish insights from this data.
Colorado
Colorado currently has the most impressive transparency laws, which California appears to be mirroring. Employers must post wages and information for all promotion opportunities and job openings, including remote roles that can be performed anywhere.
Employers must keep records of the job descriptions and wage history for a period of two years after they finish employment and they must ensure equal pay.
Salary cannot be reliant on an applicant’s salary history – so an employer cannot pay you less just because you were earning less before and as an employee you’re allowed to freely discuss salary.
Connecticut
In June 2021, Governor Ned Lamond signed off on a salary disclosure law. Employers must disclose salary either on request from the applicant or prior to or at the time of making an offer to the successful applicant.
Salary must also be disclosed when an employee’s position changes.
Employers are also subject to more detailed equal pay laws which means that the employer has to provide that an employee is not paid less based on a protected characteristic such as race or gender but is instead based on something like credentials or geography. The aim of this is to close wage gaps.
Illinois
Illinois businesses with over 100 employees must obtain an equal pay registration certificate by March 2024 and recertify every 2 years. In order to obtain this, employers must report the total wages for each employee and separate them by race and gender. The employer must also show that they are evaluating and correcting wage disparities.
Chicago currently has a proposed bill to enforce employers within the city to state salary ranges in job postings and it has been suggested this could be rolled out state-wide.
Maryland
The Equal Pay for Equal Work law bans employers from asking candidates about their salary history. It also requires employers to disclose the pay range on request from applicants.
Massachusetts
Massachusetts was the first state to pass an equal pay act which prohibited employers from asking about salary history and allowed employees to freely discuss their wages.
Employers with 15 or more workers will be required to share estimated salary ranges on job postings if a new bill is agreed upon. It’s looking highly likely that this will become law in 2023.
Nevada
Nevada employers cannot ask about salary history and are prohibited from refusing to hire or interview based on their refusal to disclose.
They must also automatically tell an applicant the salary range after the initial interview, regardless of whether an applicant has asked for it.
For internal candidates, employers must provide a salary range for those who have either applied for a role, completed an interview, or requested it.
New Jersey
Although there is currently not a state-wide law in place, in Jersey City all employers with five or more employees must post a minimum and maximum salary or hourly wage that it believes they will pay at the time of posting. This is for employment opportunities, transfers, and promotions.
New Jersey state and municipal laws on pay transparency are currently in draft for a vote in 2023.
New York
From 17 September 2023, employers advertising a job, promotion, or transfer opportunity in the state of New York must provide details of actual compensation or a salary range. This new law will impact any organization that employs four or more people.
Employers that violate the law would face civil penalties of up to $1,000 for a first-time violation, $2,000 for a second violation, and $3,000 for the third and any subsequent violations.
Several cities within the state have further regulation. In New York City, this same guidance came into effect in November 2022. In the city of Ithaca, employers of four or more employees must post a minimum and maximum hourly rate or salary. In Westchester, New York, the salary range must reflect the amount at the time of posting that the employer believes it will pay.
Ohio
Ohio is another state that does not currently have state-wide laws but does have laws within two of its major cities, Toledo and Cincinnati.
In Cincinnati, employers are banned from asking applicants about salary history and employers must provide the pay range for a job after they’ve made an offer if an applicant asks for it.
In Toledo, the rules are very much the same.
Rhode Island
From January 2023, Rhode Island employers must disclose salary ranges at an applicant’s request or prior to discussing compensation. They must also disclose to current employees when they move into a new position and at any time during employment that they request this information.
Washington
In 2019, Washington made amendments to their Equal Pay and Opportunities Act requiring employers to provide the salary range for a position to employees offered an internal transfer if the employee requests, and provide a minimum and maximum pay range for a job after they’ve made an offer.
As of earlier this year, employers of 15 or more employees must advertise salary ranges on job postings across the state.
What to do when applying for a job without salary transparency
When applying for a role without an advertised salary, it’s easy to feel lost. Job applications take a lot of time, so spending hours on an application only for the salary to be well below your expectations can feel like a total waste of time.
The most important thing is to start off by knowing your worth as an applicant. Use ouyr free ValueMyResume tool to assess how much your resume is worth. If the calculator is well below what you think, it’s probably time to give your resume some love, making sure that you showcase the skills and experience that the next career stage is looking for.
You should then explore roles in your area and read through our salary data which will help you to establish how salaries have changed year on year, and the top companies hiring in your area.
It’s also worth remembering that just because there isn’t a state law in place, it doesn’t mean that an employer won’t disclose. Before applying to a role, you could ask the hiring manager if your salary range is in their hiring bracket, they may not be able to tell you the salary range but they may be able to answer yes or no.
If you’re applying for a remote role, why not ask a friend to search for a role in Connecticut where an employer has to disclose salary?
Interested in finding out more about what other jobseekers think about salary transparency in the US? You can read more about it here.
With forward-thinking companies across the US already jumping on the pay transparency trend, Americans can expect easier access to key salary information regardless of their location.
Join our campaign for salary transparency
At Adzuna HQ, we’re on a mission to make the job market fairer and more transparent, and you can help! We’re calling on all businesses to show salaries in their job ads and campaigning for the government to make this the law
Want to transform the job landscape for the better? Sign our petition now.
Read more: Top 10 most relaxing jobs in the US
Visit our site to find out more about our campaign to #MakeSalariesMandatory on all job ads.