Foley & Lardner LLP Senior Counsel Michael Ryan is quoted in the American Banker article, “Pay transparency laws present challenges to fintechs,” discussing the consequences of new pay transparency laws in several states for both employers and employees.
“Some people’s immediate reaction to pay transparency is that it is a clear positive for employees, who now have access to more information, and a negative for companies, who now have to give away information to employees to their bargaining disadvantage,” said Ryan. “The issue is not nearly so black and white. Employees will have access to more information than before, and it likely will be a positive for them in negotiating compensation, but companies will also have an easier path to gathering compensation information about their competitors than they did before.”
While salary ranges under the laws are meant to be provided ‘in good faith,’ some companies have advertised absurdly wide ranges. “Companies that post huge, unreasonable salary ranges in an effort to avoid true compliance with pay transparency laws are more than likely violating the pay transparency requirements in most, if not all, states with such laws,” cautioned Ryan.
Ryan explained that while he has not seen enforcement of the laws as of yet, he suspects that “enforcement will pick up in 2023 and beyond, as the requirements become clearer and more ubiquitous.”
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