Pay transparency laws gaining traction in some areas

Regulations in California, Rhode Island, Washington state take effect Jan. 1, 2023

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

Many applicants see the benefit of sharing this information at the beginning of the process and not right before a candidate accepts or chooses not to accept a position because of the pay. But employers may be hesitant to disclose that information upfront for a number of reasons, including the fear that doing so will lessen their pool of applicants.

A veterinary surgeon working on a computer in a veterinary hospital
Employers who want to attract and retain the best talent need to offer competitive and comprehensive compensation and benefits packages, provide opportunities for professional development, and attend to the practice culture and work environment.

However, more states have started mandating that job postings include salary information as a way to add greater transparency to the hiring process.

Starting Jan. 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 with companies’ job postings.

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

California’s law was more recently amended to require companies with 15 or more employees—an estimated 200,000 companies—to start disclosing pay ranges on ads for jobs that will be based in the state.

California employers will also need to keep records on job titles and compensation for all employees for as long as they're employed and for three years afterward.

Rhode Island’s law will require employers to provide candidates with information on pay range during interviews upon request. Employers will need to disclose the pay range for a role before they discuss compensation.

Rhode Island employers also will need to disclose the salary range when an employee moves into a new position. And workers will be able to ask their employer for the salary range of their current role.

The following states already have similar laws on the books:

  • Since October 2020, Maryland has required employers in the state to provide a wage range for a position upon request of the applicant and has banned questions about salary history in the application process.
  • Colorado's Equal Pay for Equal Work Act went into effect at the start of 2021. The law requires employers with at least one employee in the state to list compensation in job postings, notify employees of promotional opportunities, and maintain records of job descriptions and wage rates for the duration of an employee’s tenure and two years afterward.
  • In October 2021, Connecticut began requiring employers to specify a wage range either upon the applicant’s request or by the time an offer is made, whichever comes first. Employees must also be provided a wage range upon hiring, a change in their position, or their first request for a range.
  • Nevada has required, as of October 2021, that employers and employment agencies based in the state must disclose a pay range to applicants who have interviewed for a position. Pay ranges must also be provided to current employees upon request and in the application and interview process for employees requesting or applying for a promotion or transfer.
  • Since July 28, 2019, Washington state has required employers, upon request and after making an offer, to provide external job applicants with the minimum wage or salary for the position and provide internal job applicants with the wage scale or salary range for the new position. New regulations in the state go into effect Jan. 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, the wage scale or salary range should have a low and high number, rather than open-ended descriptions, such as “up to $29 per hour” or “$60,000 and up.”

In addition, New York City's pay transparency law (PDF) took effect on Nov. 1. The law requires most employers to provide "good faith" salary ranges on job ads, promotions, and transfer opportunities.

Several states have laws saying 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 employers can’t prohibit current employees from discussing pay.

Effects on veterinary job seekers

Advocates for pay transparency laws say knowing the salary range before receiving a job offer can make it easier to figure out where to start in terms of negotiations.

Ashli Selke, president of the National Association of Veterinary Technicians in America, said: “In general, I do see how members are excited with salary transparency. It saves both the veterinary technician and the potential employer so much time in not having to go all the way through the interview process just to find out that the pay is not what was envisioned by the potential employee.”

It’s becoming more common for companies to post salary ranges even if they’re not in a state where they must. According to a survey by global advisory company WTW of 388 business leaders, 17% of companies say they’re disclosing information on pay ranges where doing so is not required. And a majority, 62%, of organizations are planning to disclose pay ranges in the future or considering doing so, even when it’s not legally required by the state.

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

Effects on veterinary employers

On the flip side, employers who want to attract and retain the best talent need to offer competitive and comprehensive compensation and benefits packages, provide opportunities for professional development, and attend to the practice culture and work environment.

“My personal prediction is that this would increase the number of candidates for a position, given that the wage was an acceptable living wage or higher,” Selke said. “History and data has shown that credentialed veterinary technicians have been working underpaid for far too long.”

Some groups argue that pay transparency creates a narrowing gap between pay for new employees and seasoned employees, which often occurs when companies increase pay to attract talent.

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

That said, pay transparency on job postings could mean more applicants for positions. A 2022 survey from hiring platform Indeed of 1,500 U.S.-based job seekers reported that 75% said they’re more likely to apply for a job if the salary range is listed, and 56% are more likely to apply to a company whose name they don’t recognize if the salary range is listed.

However, the survey indicated that pay transparency can hurt companies where pay is less equitable. Sixty-nine percent of survey respondents said they started looking for a new job after finding out they were making less than their co-workers.