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A closer look at states with pay transparency laws

On Behalf of | Jul 12, 2023 | Wage & Hour Law

Understandably, California workers want to know they’re receiving fair wages. With pay-related discussions being a hot-button issue with many employers, this situation leaves workers longing for clarity. Fortunately for workers, lawmakers in certain states and cities are pushing for employers to follow pay transparency laws.

What is pay transparency?

Pay transparency involves employers making payment information freely available to potential and existing employees. An example of pay transparency is a company posting an online job opening that lists how much this position pays. The push for pay transparency also requires states following these laws to have private companies file yearly reports disclosing how much it pays their employees.

States with pay transparency laws

As of now, only eight states have pay transparency laws in place. They are:

  • California
  • Colorado
  • Connecticut
  • Maryland
  • Nevada
  • New York
  • Rhode Island
  • Washington

The following counties and cities passed pay transparency-related legislation in states where these laws are not yet state-wide:

  • Cincinnati, Ohio
  • Jersey City, New Jersey
  • Toledo, Ohio

Punishments for not following pay transparency laws

In California, businesses that break a wage and hour law related to pay transparency can face potentially hefty fines. If a California company doesn’t report annual pay-related data to this state’s Civil Rights Department, it can face penalties based on how many employees it has and whether the business is a repeat violator. First-time violations can cost up to $100 per employee and $200 per employee for future violations. Businesses can also face punishments for not posting pay or salary rates in their job postings.

Many employees feel that pay transparency is a great way for companies to commit to honesty in the workplace.