A new controversy appears to be brewing with new pay transparency regulations proposed by the state Department of Labor and Workforce Development.
The proposed requirements for the public notification of promotions, new jobs and transfer opportunities, posted by the agency on Sept. 15, follow a new pay transparency law signed by Gov. Phil Murphy earlier this year.
The concern for the business community is a regulation that states for each job opportunity an employer advertises externally or internally, the employer must include a range of hourly rate or annual pay that is no more than 60% of the minimum pay or salary.
As an example, an employer posting a pay range between $20 an hour and $34 an hour would be in violation of the rule. So too would an employer advertising a salary between $100,000 and $165,000.
This comes after NJBIA and others in the business community specifically and successfully lobbied to have no such requirements with the pay or salary range as part of the new law.
“This was a sticking point in our deliberations with the bill sponsors,” said NJBIA Chief Government Affairs Officer Christopher Emigholz. “It’s one of the reasons we went from opposing the pay transparency bill to being able to take a neutral position on the final version of it. We felt there was significant positive movement and a level of fairness there.
“Now, we do agree there is a spirit of the law that should be adhered to. You shouldn’t be so vague to say your salary range is between $1 and $1 million. But it is concerning that NJDOL appears to be trying to change the negotiated law so specifically.
“We believe it is exceeding its statutory authority as it relates to this provision,” Emigholz said.
Multiple employers from various sectors have already reached out to NJBIA about their concerns with this new law and its proposed regulations that go beyond what the law prescribed.
“There are several reasons why this is problematic,” Emigholz explained. “Foremost is the strictness of the range limits that is likely to restrict an employer’s ability to negotiate in a competitive labor market.
“On the competition front, businesses may be concerned that publicly revealing a specific salary or pay range could provide an advantage to competitors who can use the information to lure away talent.
Additionally, Emigholz said, there could be “a company culture issue here in that the limits of the pay range could lead to others in the company thinking that their or their colleagues’ salary is too low or too high.”
NJDOL is accepting written comments on the rule proposal until Nov. 14. Employers can find more information here.
