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A new law that went into effect this week requires most California employers to disclose salaries in their job postings.
This law affects all businesses with 15 or more employees and looking for jobs that can be done in California. From hourly and contingent jobs to highly paid technology executive recruitment.
That means we can now know what salaries top tech companies pay their employees. for example:
Notably, these salary lists do not include bonuses or equity grants that many tech companies use to attract and retain employees.
California is the latest and largest state to enact a payroll transparency law, following Colorado and New York City, which previously passed similar policies. But more than 20% of his Fortune 500 companies, including technology and media leaders, are based in California, and a new California law is a tipping point that will make posting salary information a standard practice. Advocates want it to be
In the United States, there are now 13 cities and states that require employers to share salary information, covering about one in four workers in the United States, according to Payscale, a software company focused on salary comparison. I’m here.
California’s Pay Transparency Act aims to narrow the gender and racial pay gap and enable minorities and women to compete better in the labor market. For example, you can compare your current salary to job listings for the same job title to see if your salary is low.
According to the US Census, women earn about 83 cents for every dollar men earn.
“Many different factors will be required for men and women to get the same pay for the same amount of work and experience,” said California Senator Monique Limon, who sponsored the new law. Told. “One of them is transparency around salary ranges.”
But new disclosures under the law may not convey the full picture of what jobs pay. Also, the law does not require companies to disclose bonuses or stock awards.
When the California Chamber of Commerce opposed the bill last year, it said the law could punish ambitious workers seeking more money for their experience and skills. Employers may be wary of disclosing salaries to prevent bidding wars for top talent.
In a comment to CNBC, a Meta spokesperson said: US for people doing similar jobs. The company also noted that it typically pays full-time employees in stock as well as cash.
Apple and Google did not immediately return requests for comment.
new law
California Senate Bill 1162, passed in September and effective January 1, has two main components.
The first is Job Posting Payment Transparency, which applies to all businesses with more than 15 employees if you can work in California.
Part 2 requires companies with more than 100 employees to submit to the State of California a payroll data report with detailed payroll information broken down by race, gender, and job category. Companies are required to provide similar reports at the federal level, but California now requires more detailed reports.
Employers must maintain detailed records of each position and its wage history, and the California Labor Board can inspect those records. California can enforce the law and investigate violations through fines. The report will not be made public under the new law.
California Senator Limon said the bill would help close the pay gap by giving people information so they can negotiate better wages and find out if their experience and skills are underpaid. to determine whether or not there is It also helps the state make sure businesses follow existing equal pay laws.
“The reason this is important is because we cannot deal with invisible problems,” Limon said.
Limón also hopes the requirement will help California companies hire the best talent and compete with other states where employers don’t have to pay salaries. Ultimately, she says, making sure women and people of color are paid equally helps California’s economy.
Pay transparency laws can create competition among companies that need to compete for the best talent. Some companies may even choose to post a salary range on their non-mandatory job postings.
“The consequences are not just for individuals, they have economic implications for the nation because people are underpaid,” Limon said. “That means they’re limited in their earning power and the ways they can contribute to this economy in California through the sales market, housing market and investment because they’re not paid fairly. ”
loophole
The new law does not require employers to disclose total compensation. This means that companies can omit information about equity grants and bonuses, giving a very imperfect picture of some high-paying jobs.
For high-paying jobs in the technology industry, stock compensation in the form of restricted stock units can represent a large portion of an employee’s take-home pay. In industries such as finance, bonuses make up a large portion of annual income.
“At the end of the day, especially for technology employees, they want to know the total compensation,” said Zuhayeer Musa, co-founder of Levels.fyi, a company specializing in recruiting and coaching tech employees. said. “Sometimes the stock compensation is more than his 50% of the actual total compensation.”
Musa said shares in big tech companies are fundamentally liquid because they can be sold quickly on the stock market.
The new law also allows companies to offer a wide range of salaries, sometimes exceeding $100,000 between the lowest and highest salaries. While this seems to go against the spirit of the law, companies say the range is realistic, as base salaries can vary widely depending on skills, qualifications, experience, and location.
Companies may be open to hiring candidates with a wide range of experience, from entry-level to advanced, for specific job openings, said Lulu Seikaly, senior corporate attorney at Payscale.
Seikaly said she encourages clients to post job listings at specific seniority levels to narrow the potential salary range.
“When I talk to customers and they ask me what I think the extent of honesty is, I tell them it’s a business decision, but especially from the legal side, when you post by level, you have to The way to do it is to cover more than one broad post.
Some companies in California don’t list salaries for jobs that are expressly intended to be conducted in other states, but proponents say new California law will lead to higher salaries across the country. I hope disclosure is made. After all, a job posting with a clear starting salary or range is likely to attract more candidates than one with an unclear salary. It is expensive.
“I was telling some people this morning that transparency in payments is kind of the exception now.
