Pay transparency laws are increasing traction in some areas

Whether you’re looking for a job or looking to fill a position, the hiring process can be time-consuming and complicated for both parties. And inevitably, the potentially thorny subject of compensation must be addressed.

Many candidates see the benefit of sharing this information early in the process, rather than right before a candidate accepts or chooses not to accept a position due to pay. But employers may be hesitant to disclose this information upfront for a number of reasons, including the fear that it will reduce their applicant pool.

However, more states have begun requiring job postings to include salary information as a way to add more transparency to the hiring process.

Starting January 1, 2023, the states of California and Rhode Island will join a growing list of states and cities that require salary information to be included in company job postings.

In January 2018, the California Equal Pay Act became the first law in the country to prohibit employers from asking applicants about their salary history. The law also requires employers to disclose the job’s salary range if an applicant requests it after an initial interview.

California law was recently amended to require companies with 15 or more employees — about 200,000 companies — to begin disclosing pay ranges in advertisements for jobs that will be based in the state.

California employers will also be required to keep job title and compensation records for all employees while they are employed and for three years thereafter.

Rhode Island law would require employers to provide applicants with salary range information during interviews upon request. Employers will need to disclose the salary range for a position before discussing compensation.

Employers in Rhode Island will also have to disclose the salary range when an employee moves to a new position. And workers will be able to ask their employer about the salary range for their current position.

The following states already have similar laws on the books:

• As of October 2020, Maryland requires employers in the state to provide a salary range for a position when requested by an applicant and prohibits questions about salary history in the application process.
• Colorado’s Equal Pay for Equal Work Act went into effect in early 2021. The law requires employers with at least one employee in the state to list compensation in job postings, notify employees of promotion opportunities and maintain job description records and the rates of pay for the term of office of the officer and two years thereafter.
• In October 2021, Connecticut began requiring employers to set a salary range either at the applicant’s request or by the time an offer is made, whichever comes first. Employees must also be provided with a salary range upon hire, change of position or their first request for a range.
• Nevada requires, beginning in October 2021, that employers and employment agencies based in the state disclose a salary range to applicants who have interviewed for a position. Pay ranges must also be made available to current employees upon request and in the application and interview process for employees seeking or applying for a promotion or transfer.
• Effective July 28, 2019, Washington State requires employers, upon request and after making an offer, to provide external job applicants with the minimum wage or salary for the position and to provide internal job applicants with the salary scale or salary range for the new position. New state regulations go into effect on January 1, 2023, requiring employers in the state to include pay ranges and a general description of benefits and other compensation in all job postings. The new guidance also provides detailed examples of information that should and should not be included. For example, a salary scale or range should have a low and a high number, not open-ended descriptions such as “up to $29 per hour” or “$60,000 and up.”

In addition, New York’s Pay Transparency Law (PDF) went into effect on November 1st. The law requires most employers to provide “good faith” salary ranges in job postings, promotions and transfer opportunities.

Several states have laws that say employers can’t ask applicants about their salary history or use that information to decide whether to hire them or what to pay them. Some states also have laws that say employers can’t prohibit current employees from discussing pay.

Effects on veterinary job seekers

Proponents of pay transparency laws say that knowing the salary range before you receive a job offer can make it easier to judge where to start in terms of negotiations.

Ashley Selke, president of the National Association of Veterinary Technicians of America, said, “Overall, I see members excited about salary transparency. This saves both the vet technician and the potential employer so much time by not having to go through the entire interview process only to find out that the pay is not what the potential employee envisioned.”

It’s becoming increasingly common for companies to publish salary ranges even if they’re not in a position to do so. According to a survey of 388 business leaders by global consultancy WTW, 17% of companies say they disclose information about pay ranges when it is not required. And a majority, 62 percent, of organizations plan to disclose pay ranges in the future or are considering doing so, even when not required by state law.

While more companies are considering pay transparency, an article in the Harvard Business Review says job seekers shouldn’t rely on pay as the sole consideration for accepting a position. In veterinary medicine, some of the other factors are practice culture, work environment and opportunities for professional development.

Effects on veterinary employers

On the other hand, employers who want to attract and retain top talent must offer competitive and comprehensive compensation and benefits packages, provide professional development opportunities, and nurture the practice culture and work environment.

“My personal prediction is that this will increase the number of applicants for a position given that the salary is a living wage or higher,” Selke said. “History and data show that veterinary technician graduates have worked too long for too little pay.”

Some groups argue that pay transparency creates a narrowing gap between the pay of new hires and experienced employees, which often happens when companies raise pay to attract talent.

According to a Forbes article on the California Equal Pay Act, “The California Chamber of Commerce, which called an early version of the bill a ‘job killer,’ warned that SB 1162 would encourage litigation against employers.”

However, pay transparency in job postings can mean more applicants for positions. A 2022 survey by employment platform Indeed of 1,500 US-based job seekers reported that 75% said they were more likely to apply for a job if the salary range was listed, and 56% were more likely to apply to a company whose name I don’t recognize if the salary range is listed.

However, the study found that pay transparency can hurt companies where pay is less fair. Sixty-nine percent of those surveyed said they started looking for a new job after realizing they were earning less than their co-workers.