2024 State By State Pay Transparency Laws: Key Insights For Employers

Gender pay disparities persist in the workforce, with women, particularly women of color or those with disabilities, facing significant wage gaps. In 2024, women working full time, year-round, earned only 84 cents for every dollar earned by men. In more than 90 percent of occupations, women earn less than men. For lawmakers, these figures highlight the urgent need for measures that address gender pay inequality and promote wage transparency.

Pay equity and salary transparency laws aim to tackle these disparities by providing employees with access to salary data and requiring employers to disclose salary ranges. By arming workers with information and promoting transparency, these laws seek to empower individuals to negotiate fair compensation and contribute to closing the gender pay gap.

Several states have welcomed the concept of pay transparency, enacting laws to ensure employees and job applicants have access to salary information. Colorado led the charge in May 2019, followed by Maryland, Connecticut, Nevada, Rhode Island, Washington, California, and New York. Local measures include Jersey City, New Jersey; New York City, New York; Ithaca, New York; Westchester County, New York; Cincinnati, Ohio; and Toledo, Ohio.

New legislation passed or becoming effective in 2024 includes Hawaii, Illinois, Minnesota, Vermont, and Washington, DC. Maryland has also expanded its existing pay transparency law. Each state's proposed legislation contains specific provisions to promote transparency and fairness in the job market.

New 2024 Legislation By State

Hawaii

Hawaii requires employers with 50 or more employees to disclose hourly rates or salary ranges in job listings that reflect the expected compensation. This new legislation took effect on January 1, 2024, aiming to provide greater transparency and fairness in the hiring process by ensuring job seekers are informed about potential earnings upfront.

Illinois

In Illinois, the new pay transparency law mandates that employers with 15 or more employees disclose the wage or salary range and a general description of benefits and other compensation expected for a position. This includes bonuses, stock options, or other incentives. Additionally, employers must inform current employees about promotion opportunities no later than 14 calendar days after posting the position externally. This legislation will become effective on January 1, 2025.

Maryland

Maryland's expanded pay transparency law will require employers to post the minimum and maximum hourly/salary range they will pay for a role in both internal and external job postings. This law, which applies to any job performed at least in part in Maryland, will also see the Commissioner of Labor and Industry provide a form for wage disclosure compliance. Effective October 1, 2024, this legislation was signed into law on April 25, 2024, ensuring that job seekers and employees have clearer insights into compensation expectations.

Minnesota

Minnesota's new pay transparency legislation will compel employers with 30 or more employees to disclose starting salary ranges and a general description of benefits and other compensation for job openings. If a fixed pay rate is offered, it must be listed in the job posting, and salary ranges may not be open-ended. This law, aimed at enhancing transparency and fairness in the hiring process, was signed into law on May 17, 2024, and will take effect on January 1, 2025.

Vermont

In Vermont, employers with five or more employees will be required to post the minimum and maximum hourly/salary range for job roles, including if the role is partially paid by tips or commissions. This legislation, which applies to positions performed in Vermont or remote roles predominantly conducted in a Vermont office, ensures transparency in compensation offers. Signed into law on June 4, 2024, it will become effective on January 1, 2025. The Attorney General will provide guidance on the law's application by its effective date.

Washington, DC

Washington, DC's pay transparency law requires employers to post salary ranges (minimum to maximum) that they believe in good faith will be paid for a role, including for promotions and transfers. Employers must also inform candidates about the existence of healthcare benefits and are prohibited from seeking salary history information. This law, applicable to any job with at least one employee in Washington, DC, was signed into law on January 12, 2024, and became effective on March 25, 2024.

Parting Thoughts

By embracing pay transparency, states aim to narrow gender and racial wage gaps, empower job applicants during the hiring process, and foster a fair and inclusive work environment. These laws provide employees with the information they need to negotiate their salaries effectively, leveling the playing field for women and minorities. Additionally, pay transparency benefits employers by reducing recruiting costs and attracting qualified candidates. As the legislative trend toward pay equity and transparency continues, employers must monitor the impact of these laws and identify best practices for implementation and enforcement.

Release Date: June25, 2024