Between poring over resumes and cover letters and multiple rounds of interviews, the job search process has often been likened to a job in itself.
No applicant wants to put hours into the process only to find that potential employers aren’t offering compensation that aligns with their needs, said Kelly Nevins, CEO of the Women’s Fund of Rhode Island.
The lack of salary transparency has more-insidious implications, Nevins said, noting this withheld information as a driving force behind pay gaps.
“Oftentimes, because people don’t know what the salary range is, they may not negotiate the best package for themselves,” Nevins said, “and that contributes to the gender wage and wealth gap.”
Though some exceptions exist, many employers have largely faced no obligations to provide salary information early in the application process. A new law, which went into effect Jan. 1 as part of Rhode Island’s Pay Equity Act, will soon change that.
The legislation requires employers to adhere to a range of new regulations intended to promote pay equity and eliminate barriers that have traditionally contributed to wage gaps related to gender, race and sexual orientation.
Among those new regulations, employers must provide a salary range for open positions upon request, though the law stops short of a requirement to post this information without prompting.
Currently, six other states – Connecticut, California, Colorado, Maryland, Nevada and Washington – have this requirement.
But even without this requirement, it’s a law that puts Rhode Island “on the leading edge in terms of pay equity legislation,” said Michael J. Yelnosky, a professor at the Roger Williams University School of Law who specializes in employment and labor law.
Still, Yelnosky says he’s “less convinced the transparency provisions themselves will make a big difference,” partially because the law puts the onus on employees to access pay information.
Requesting a salary range is “a hard thing to do if [employers] aren’t providing it during an application process, or during consideration for promotion,” Yelnosky said. “It requires somebody to put themselves out there, be a little bit of a fly in the ointment when they’re trying to be as attractive to the employer as possible.”
Yelnosky says the penalty for employers is “quite modest” and doesn’t benefit the applicant or employee.
But while not a comprehensive reform, that doesn’t mean the law isn’t a step forward, he added.
“Pay transparency helps create an environment in which pay discrimination is easier to identify, and where employers may be more likely to identify their own discriminatory practices,” Yelnosky said.
According to a Sept. 26, 2022, blog post from Robert P. Brooks, managing partner at Adler Pollock & Sheehan PC in Providence, on the firm’s website, penalties could be severe, including employers being liable for unpaid wages; compensatory damages; liquidated damages up to twice the amount of unpaid wages and/or benefits; reinstatement of the employee’s position, fringe benefits and seniority rights; punitive damages; and attorneys’ fees and costs.
Additionally, the R.I. Department of Labor and Training may impose civil penalties between $1,000 and $5,000, however the act provides a two-year grace period in which civil penalties will not be assessed from Jan. 1, 2023, through Dec. 31, 2024.
On the employer side, most larger companies already have the needed systems in place to evaluate their current compliance and create compensation systems, said Cynthia Butler, president of Butler & Associates Human Resources Consulting in Jamestown. For small and midsized companies, she noted, it might take more time and effort to evaluate and establish these systems, as some may not even have formal job descriptions or pay grades.
For businesses across the board, “one of the big changes in this legislation is the concept of equal pay for equal work,” Butler said. “This is more complicated because it talks about comparable work, and the definition of that isn’t so clear.”
Difficulties can arise because employers “aren’t always necessarily comparing jobs in the same job title” when defining pay ranges, she said, “so you really need a system to be able to evaluate the skills, the efforts and the level of responsibility.”
Even before the legislation went into effect, Nevins encouraged applicants to ask for a pay range early in the process, advising them that whether a business complies, the answer can speak volumes about its culture around transparency.
When it came time to put this advice into law, Nevins helped to write the legislation and worked on negotiations with the business community.
While the goal is to increase pay equity among employees, the salary transparency provision will ultimately save time for employers and job applicants, Nevins said.
“The idea behind it is, No. 1, if you’re someone who is thinking about a job and the salary range is too low for you, why waste your time and the employer’s time applying for it?” Nevins said. “No. 2, it gives prospective employees the information to understand [what] they might have for negotiation.”