New Jersey could be the latest state to require salary transparency in job postings, a growing trend up for discussion in the state Legislature Thursday.
A new measure (A3937) would make the Garden State the sixth state with a law mandating certain businesses to disclose salary ranges or hourly wages when advertising jobs. The bill would also require employers to announce all promotions in internal and external job postings.
Assemblyman Paul Moriarty (D-Gloucester), leading sponsor of the bill, said this change would help employers and job-seekers alike.
“I’ve long felt that it’s a waste of time for people applying for jobs, and it’s a waste of time for businesses to go through the interview process and applications, only to find out you don’t mesh in terms of salary requirements,” Moriarty said.
New Jersey’s regional economy makes this a competitive area to recruit workers, Moriarty said, noting that New York and Connecticut have pay transparency laws. He said he’s concerned that people may not bother looking for work in New Jersey if they can look in nearby states where job postings are required to have salary information.
“This is regional competitiveness — we may be losing candidates to other states,” he said. “We need people to fill jobs, and we know businesses are struggling to find and identify good candidates.”
The bill is up for discussion in the Assembly Labor Committee Thursday morning. An identical Senate bill has not been voted on in the chamber’s labor committee.
Pay transparency is becoming increasingly common in New Jersey job postings, according to Indeed Hiring Lab, which analyzes job markets. Last year, about a quarter of job postings included salary information, and by February, 40% did, the company said.
“This movement can be seen by job seekers as a commitment to narrow the gender pay gap and increase trust within the work environment, two critical factors to attract and retain employees,” said Cory Stahle, an Indeed Hiring Lab economist.
The bill could face some resistance from business leaders. Alexis Bailey, vice president of government affairs with the New Jersey Business and Industry Association, urged the Legislature to proceed with caution on this issue, saying similar laws in other states have had varying degrees of success.
One of the biggest issues in other states has been companies posting extreme salary ranges to flout the requirement. Following the enactment of New York City’s law in November, Citigroup advertised jobs with a range of zero to $2 million, according to Gothamist.
“There’s just so many factors that go into compensation that it makes it difficult to say if we should have a hard-and-fast rule on what ranges should be. I think from a policy standpoint, maybe we should take the wait-and-see approach on this,” she said.
Moriarty conceded he’s seen some issues in other states that rolled out pay scale transparency but said he’s confident “those things will work themselves out.”
More people and businesses will get accustomed to acceptable salary ranges, and anyone trying to get around the law with outrageous examples would have to face scrutiny from state labor officials, he said.
A similar bill sponsored by Assemblywoman Britnee Timberlake (D-Essex) would be better for New Jersey businesses, according to Bailey. The bill, which would also require employers to include pay information and a description of benefits and retirement plans, has not yet been scheduled for a committee vote.
Bailey called Timberlake’s bill “more straightforward” for New Jersey businesses. While Moriarty’s bill would apply to companies with five or more employees, Timberlake’s would cover businesses with 10 or more.
Bailey also took aim at the provision in Moriarty’s bill requiring publicly advertising internal promotions.
Promotions can reward hard-working employees, not necessarily indicate a new position opening up, Bailey said. It would make “practical sense” to remove the promotional notification requirement, she said, adding it’s not a huge problem that workers face.
Moriarty said it’s important for people to know a job is up for grabs.
“People are promoted, and no one else even knew that promotion was available,” he said. “It’s another effort for transparency in the workplace, and that’s the reason I want to push for it now.”
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