New York Pay Transparency Law Explained

In today’s workplace, pay transparency isn’t just a trend anymore—It’s a movement. For Human Resources (HR), it’s changing how we hire, how we talk about compensation, how we build trust with our teams, and can even affect your company’s reputation. 

New York is one of the states that’s leading in this area, with both state and city level pay transparency laws now in effect. Whether you’re hiring in Manhattan, managing a remote team out of Buffalo, or just trying to keep your pay policies and practices consistent across states, understanding these laws is essential. 

Here are three key takeaways you’ll learn in this article: 

1. Review key elements of NY’s state pay transparency law 
2. What’s expected of you as an employer 
3. How to stay compliant while keeping your recruiting momentum strong 

What is the New York Pay Transparency Law? 

New York State’s Pay Transparency Law went into effect on September 17, 2023. It’s officially known as Labor Law § 194-b. This law applies to employers with four or more employees, even if some of them are remote. It covers private businesses, nonprofits, and labor organizations. 

What does the law require you to do?  

Employers with 4 or more employees must do the following in their job postings, both internal and external: 

• A good-faith salary range, either hourly or annual pay 
• A job description, if one exists 
• If the compensation is completely commission-based, then employers must clearly state that in the job posting 

Again, remember that remote roles count too.  If the position reports to a manager or office in New York, then it’s covered under the law. This applies even if the candidate is working in another state. 

If you’re already familiar with the New York City pay transparency law, much of this will feel familiar. New York’s city law came first and laid the groundwork for the state law. 

Pay Disclosure Requirements 

There are several disclosure requirements, including: 

• Salary ranges need to appear in every job ad, promotion, or transfer opportunity. 
• Remote roles are included if the reporting structure ties back to New York. 
• A good-faith range should reflect what you’re really prepared to pay. Don’t just include a wide range or placeholder like “$0–$200,000.” 

No Questions About Salary History 

Be aware that both New York City and State have enacted salary history bans, making it unlawful for employers to: 

• Ask about an applicant’s salary history. 
• Use prior wages to determine their pay.

As a result, employers need to rely on a candidate’s qualifications, experience, and the role in general to determine compensation, and not what they earned in the past. This helps to close historic pay gaps that follow employees throughout their careers. Keep in mind though that employers can still ask questions about a candidate’s salary expectations.  

Employee Rights to Watch 

Employees have options if they have complaints related to pay transparency, including: 

• Employees and applicants can file complaints with the NY Department of Labor if postings don’t follow the rules. 
• They’re also protected from retaliation if they ask about pay ranges or speak up about a noncompliant posting. 

Compliance & Documentation 

No specific recordkeeping deadlines are outlined in the law, but as with anything in HR, documentation matters, especially if concerns are raised. With that said, we recommend you: 

• Save your job postings, salary ranges, and job descriptions. 
• Be ready for a potential compliance audit or questions at some point down the road. 

What Happens If You Don’t Comply? 

Let’s talk consequences. The New York State Department of Labor enforces this law, and penalties can escalate quickly: 

• First violation: Up to $1,000 
• Second violation: Up to $2,000 
• Third or more: Up to $3,000 

Currently, there’s no private right of action under state law, meaning applicants can’t sue directly, but the NYC law may allow for other remedies. 

Bottom line? Don’t wait for a complaint. Be proactive. 

Other related local laws across New York may follow similar rules, so double-check based on your hiring locations.