How wide should the salary range be? Business and labor disagree

Businesses and workers in New York clash over what is considered an acceptable wage range.

Starting Tuesday, employers hiring in New York must list their minimum and maximum salary ranges in all their job postings. The city’s Wage Transparency Act states that businesses must post a “bona fide salary range,” defined as one that the employer “honestly believes at the time it posts the job advertisement that it is willing to pay the successful applicant(s) says the New York City Commission on Human Rights, which enforces the law.

But throughout the week, New Yorkers have called out job postings with ranges above $100,000, questioning whether a six-figure salary bracket is considered a “bona fide” range.

Who is responsible for determining the ranges of “good faith”.

Although the process of determining and publishing bona fide ranges falls to employers, whether this is truly acceptable is played out in the court of public opinion.

The law’s chaotic rollout “is ultimately not surprising” to Victoria M. Walker, 29, a freelance journalist in New York who went viral earlier this year by revealing her salary for a job she left. On Tuesday she started a Twitter thread of companies’ pay ranges for job vacancies, such as a range of $50,000 to $145,000 for a technology reporter role.

“Companies had ample opportunity before the law went into effect to be transparent about wages,” Walker says. “Now that they are forced to do so, the fact that some companies will give a very wide range is not entirely surprising.”

“Job seekers should view these wide-range salaries with an air of skepticism,” she adds.

Walker and other proponents of salary transparency say it can be a win-win for both workers and businesses—candidates save time by only applying for jobs that meet their pay expectations, and feel more empowered to negotiate pay later while companies save time on quality screening candidates who meet their salary budget.

But employers say they’re in a tough spot and don’t have much guidance from the New York City Commission on Human Rights, says Domenic Camacho Moran, a New York-based attorney with Farrell Fritz.

Many firms may post broad ranges to show they are open to applicants with different years of experience, she says. Others, worried about losing talent, are expanding their pay ranges to ensure they can pay competitively in a tight hiring market.

“Better to err on the side of a wide range than to create an artificially narrow range,” says Camacho Moran.

The two agencies that investigate possible violations of the new law — the city’s Human Rights Commission and the Bureau of Law Enforcement — can determine whether a wide range is not done in good faith, said Tony Guadani, senior research director at Gartner.

But it’s up to investigators to show that the salary range isn’t bona fide, not for the companies to prove it.

Others say a wide range, as those approaching the six-figure mark will only cause more confusion and friction. “The spirit of the law is to create transparency, and any company that has such wide pay ranges is not creating any transparency,” said Beverly Neufeld, president of PowHer New York and a supporter of the new law.

Walker agrees and hopes companies will become more specific with their “good faith” ranges over time: “Hopefully we’ll stop seeing astronomical salary ranges and companies will tell people what they can expect in the role. A range of $50,000 to $140,000 isn’t telling me much. I’d say it’s more confusing.”

Public scrutiny can also play a role, as workers “question and challenge companies that are not committed,” she adds.

Employers can still pay more or less

Although employers must list salary ranges for each job posting, it is still possible to pay the final applicant above or below what they advertised.

“The law doesn’t say anything that prohibits an employer at some point in the process from concluding that it needs to change compensation,” says Camacho Moran. “If in fact, down the road, there is a legitimate, non-discriminatory business reason to change pay, the employer is free to do so under the law.”

For example, a business may realize that the job scope falls into a lower level and lower pay range. On the other hand, a standout candidate may be able to negotiate or be offered a starting salary above the above.

But employers should make sure that any such cases are outliers and not part of a pattern.

“Every employer has to remember that while this might happen once or twice, if it happens every time and there’s an audit or an investigation, the argument will be that there was no good will in creating the range,” says Camacho Moran .

Businesses found to be in violation of the wage range law can be fined up to $250,000 or face legal action.

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