Illinois and Hawaii have joined several other states — New York, California, Washington and Colorado — that have enacted pay transparency laws.
Gov. JB Pritzker on Aug. 11 signed into law HB 3129, which amends the Illinois Equal Pay Act to require Illinois employers with 15 or more employees to disclose pay scale and benefits information in all covered job postings. The legislation follows regulations signed into law on Aug. 4 that require staffing firms to provide temporary workers with pay equal to that of directly employed workers.
In addition to sharing a salary range for a position before asking candidates about their wage expectations for the role, the new legislation requires employers to notify workers of promotion opportunities within 14 days after the job is posted externally.
The new pay transparency law takes effect on Jan. 1, 2025.
“Pay scale and benefits” is defined in the statute as “the wage or salary, or the wage or salary range, and a general description of the benefits and other compensation,” including bonuses, stock options and other incentives. According to a JDSupra blog post from law firm Morgan Lewis, employers must set the wage or salary according to an “applicable pay scale, the previously determined range for the position, the actual range of others currently holding equivalent positions or the budgeted amount for the position, as applicable.”
Hawaii Gov. Josh Green on July 3 signed Senate Bill 1057, which requires all Hawaii employers to “disclose an hourly rate or salary range that reasonably reflects the actual expected compensation” for a particular job posting, according to a blog post from law firm McGuireWoods LLP.
This requirement does not apply to internal transfers or promotions; public employee positions for which salary, benefits or other compensation are determined pursuant to collective bargaining; or positions with employers having fewer than 50 employees. Hawaii’s bill also adds that pay disparities are now prohibited based on any category protected under state law, not just sex.
The new law will take effect on Jan. 1, 2024.
The pay transparency movement is gaining traction on a federal level as well. The Salary Transparency Act was recently introduced in the US House of Representatives. If passed, HR 1599 would amend the Fair Labor Standards Act to require employers providing an employment opportunity to disclose its wage range to employees and applicants for employment and for other purposes. Delegate Eleanor Holmes Norton, D-Washington DC, introduced the legislation on March 14; it was referred to the House Committee on Education and the Workforce.