The New Jersey Pay and Benefit Transparency Act is the latest U.S. pay transparency law. As of this month, covered employers must disclose pay, benefits and other compensation programs in external job postings and for internal promotional opportunities. The law took effect June 1.
With this law, New Jersey joins 11 states and the District of Columbia in requiring employers to provide job seekers and current employees with access to compensation information.
Who’s covered?
The Act applies to employers with 10 or more employees over 20 calendar weeks that do business, employ workers, or take applications for public or private employment in New Jersey. This includes job placement and referral agencies.
New Jersey Department of Labor & Workforce Development (NJDOL) offers helpful guidance.
What’s required?
Job Postings: Internal and external job postings and advertisements for a new position, or opportunity for promotion, must include the following: (1) the hourly wage or salary (or range), and (2) a general description of benefits and other compensation programs for which the employee would be eligible.
- Non-New Jersey employers must comply with the Act if they do business in New Jersey or advertise positions to New Jersey applicants.
- Unlike “covered employers,” temporary help service firms or consulting firms need provide only the hourly wage or salary (or range) to an applicant at the time of interview or hire for a specific job opening.
A covered employer is not prohibited from increasing the wages, benefits, or other compensation identified in the posting when it makes an offer of employment to an applicant.
Promotions: Covered employers must make reasonable efforts to announce and post internal promotion opportunities to all current employees in the affected department(s) before making a promotion decision. However, covered employers are not required to provide notice of promotions that are awarded to current employees based on years of experience or performance, or that are made based on an unforeseen need.
Penalties for non-compliance
Covered employers who violate the Act are subject to civil penalties of $300 for the first violation and $600 for each subsequent violation.
Suggestions for employers
Again, the pay transparency law is in effect now. Here are some actions that covered employers should take:
- Review and revise existing job posts, internal promotion and transfer notices, and third-party recruitment postings, in accordance with the Act.
- Review and update job posting and notice templates, as well as posting practices and procedures, to ensure that posts and advertisements identify hourly wage or salary, benefits, and other compensation.
- Be mindful of the overlapping requirements of New Jersey’s Law Against Discrimination. Enacted in 2018, the Diane B. Allen Equal Pay Act prohibits employers from discriminating with respect to pay, benefits, or compensation based on any protected characteristic under the NJLAD. The Equal Pay Act expanded the remedies for pay discrimination, required employees performing substantially similar work to be compensated equally, broadened protections for retaliation, and established new reporting requirements for employers contracting with the State of New Jersey.
- Train human resources and recruiting staff on the new requirements of the Transparency Act, its overlap with the NJLAD, and the importance of compliance.
- If you’re a multi-state employer, review postings, policies, and procedures for compliance with current pay equity and transparency laws nationwide.
If you need guidance or assistance on complying with these requirements or the requirements of any state pay equity or pay transparency laws, please contact any attorney in Constangy’s Northern New Jersey or Princeton Offices.