Is Salary Transparency the Future of Hiring?

One of the worst feelings is going through rounds of interviews for a job to discover that your pay does not line up with the company’s appointed salary for the position. One of the newest trends in the hiring process is giving pay transparency at the beginning of the application process.

The thought behind pay transparency is to minimize wasted time for candidates applying to jobs and employers hiring for the position. In the United States, a handful of states are beginning to put this transparency into legislation, with New York joining some of the first states to do so.

This past Tuesday, November 1st, 2022, the state of New York made it illegal to post a job without giving a minimum and maximum compensation for the position. Although the intent was to help job seekers better identify roles within their salary range, it has seemed that this system has begun to backfire.

To keep an array of candidates applying to positions, companies are giving minimum and maximum salary ranges of up to $100,000 differences. There are examples of some companies range being $50,000-$140,000, and in some cases, companies have posted positions with a range of $0-$2,000,000.

Candidates looking to apply for positions in New York are frustrated with online responses to the new legislation because companies’ reactions feels like a mockery of the new system. Although many candidates and job seekers are unhappy with companies listing an unrealistic salary range, companies like JPMorgan Chase and Starbucks are so far honoring the new law.

The law specifically states companies must post a “good faith salary range” for every job listed, and if they do not comply are having their listings taken down from job board websites. If a company does not remove a job post that does not have a good faith salary range, if it is posted for over 30 days can be fined up to $250,000.

Hopefully, companies will continue to abide by the new law to favor and respect the time and energy of job seekers applying for their positions.