Get ready, employers. Washington State’s pay transparency law goes into effect beginning January 1, 2023, and requires employers to disclose salary and benefit information in job listings.
To help employers comply, The Washington State Department of Labor and Industries (L&I) has issued several iterations of a draft administrative policy detailing the requirements. Below we cover details of the agency’s latest clarification.
Which employers must comply with the Washington pay transparency law?
TheWashington salary range law applies to all employers with 15 or more employees engaging in any business, industry, profession, or activity in Washington.
So, even if employers do not have a physical presence in Washington, employers that conduct business in the state or recruit for jobs (including remote positions) that could be filled by Washington-based employees are subject to the law. That means the Washington pay transparency law has implications for organizations everywhere. Furthermore, employers cannot avoid the requirements by refusing to accept Washington applicants.
What qualifies as a job posting?
Job postings are defined as “any solicitation intended to recruit job applicants for a specific available position,” whether by hard copy, electronic listing, handled directly, or by a third party.
The law is specific to job postings that list qualifications for positions, including but not limited to specific knowledge, skills, or abilities.
What information must be included in job postings?
In each job posting, employers must disclose 1). the opening wage scale or salary range and 2). a general description of all benefits and other compensation offered. In electronic job postings, employers must include a general description of benefits and other compensation but may choose to link to more detailed information. The requirements also apply to transfers and promotions when requested by an employee.
When providing opening wage scales or salary ranges, employers must:
Establish, clearly define, and keep up-to-date the lowest to highest pay established for each position in active job postings
Specify all potential compensation ranges that apply for positions that can be filled with varying job titles depending on experience
Include the pay rate or pay rate range for jobs compensated by commission rates
List the entire compensation scale or range, in addition to starting range or rate, when the employer intends to implement a starting range/rate, such as for a probationary period
A general description of all benefits includes, but is not limited to, listing types of insurance, healthcare, and retirement plans; detailing the number of days or hours offered for paid time off and holidays; and listing fringe benefits, as applicable.
Other compensation includes, but is not limited to, discretionary bonuses, commissions, stock options, travel allowance, and relocation assistance. There is no requirement to provide the total monetary value of other compensation.
The Washington State L&I draft policy provides examples for each of the above requirements.
Employers found in violation can be liable for actual damages, interest on compensation owed, payment for the costs of investigation and enforcement, civil penalties, reimbursement of attorney fees and costs, and other forms of relief.
Pay transparency measures like those seen in Washington State and New York City play a significant role in ending pay discrimination in the workplace because they can reveal wage disparities within an organization. It’s only a matter of time before more states and localities across the U.S. adopt similar legislation.
Best practices for preparing for the forthcoming pay transparency requirements encourage conducting a pay equity audit. Because salary information included in external job postings will soon be made public, a proactive pay equity audit can help employers better understand their pay practices and address compensation issues before appending salary range information to job listings.
Employers that need assistance preparing for the new salary range disclosure requirements in Washington state and elsewhere should contact Trusaic. OurSalary Range Finder overlays pay equity audit data with Lightcast external market data so you can confidently price jobs equitably.
For more information on emerging pay equity laws, see ourPay Equity Definitive Guide below.
Conducting a pay equity audit is a key component to ensuring equitable compensation within your organization. Just as important as the analysis is how you communicate findings and progress with various stakeholders. Download The Pay Equity Communications Planner to learn best practices for discussing compensation, both internally and externally.