How Pay Transparency Laws Could Change Talent Acquisition Management

May 11, 2022 by Verified First

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Salary is still a big motivator for attracting talent. In fact, LinkedIn found that salary range and benefits were by far the most helpful aspect in determining if a candidate would apply for an open position. While these stats show what candidates want, many companies omit that information from job postings as a way to try and attract talent past the first step in the hiring process. But with new pay transparency laws being adopted across the United States, that’s all about to change.

Starting in November 2022, New York City businesses will be required to post the maximum and minimum salary for a role, and they’re not the only place that’s adopting this new legislation. We know that changes to the law like this one could upset your current recruitment strategy. In order to help you prepare, we’re diving into the specifics of the new pay transparency laws and how you can adapt your strategy to maintain compliance. 

What are Pay Transparency Laws?

A pay transparency law requires companies in specific states to post the minimum and maximum payments for open positions for both annual salary and hourly wage. It falls under Executive Order 11246 through the US Department of Labor. This order prohibits companies from denying equal pay based on discrimination against race, color, religion, sex, sexual orientation, gender identity or national origin

Lawmakers hope that this law will help minimize the wage gap. Currently, the uncontrolled gender pay gap is $0.82 for women compared to the $1 made by a man. This number hasn’t improved since 2021, and enacting pay transparency laws could help expose corporate gender bias and take a step toward equal pay for both men and women.

Who will these laws affect?

Not every state has adopted a pay transparency law, but some predict that will soon change. New York City is late to the party when it comes to enacting this law. Some of the states that already have transparency laws in place include:

  • California
  • Delaware
  • Illinois
  • Massachusetts
  • New Jersey
  • Oregon
  • Vermont
  • And more

As additional states join the list, organizations need to be prepared. HR and TA professionals are ultimately the ones affected most in the day to day because of this law. While the question if these laws will affect the postings for remote positions’ is not certain, it’s sure that elements of a recruitment strategy will have to change in order to maintain compliance. Be sure to check your individual state’s laws to ensure your team is operating in compliance.

How can I prepare?

To prepare your recruitment strategy for pay transparency laws, you need to rethink how you’re highlighting information in your job postings. If you were leaving the mystery of the salary range up to a future candidate’s inquiry, that may hinder you more than help you attract talent. If you can’t pay top dollar for a position, try highlighting these elements of the job in your talent acquisition strategy to entice candidates:

  1. Company Culture - Describe why your company is a positive place to work and why they should join your team and not the competition’s.
  2. Benefits - These don’t have to include 401K matching. You can showcase the everyday perks you might offer your employees like catered lunches, career advancement programs, mentorships, and any other ways they’ll benefit working for your company.
  3. Location Opportunities - If your company is located in a unique location, highlight what enriching opportunities living in that location could offer.
  4. Remote Reimbursement - Some roles are going to stay remote. Make sure to state any reimbursement programs you offer on services like phone bills or printing costs for those who work from home.

While salary is a large part of attracting a candidate to a job, it isn’t the only factor. Tap into the elements of the position and your company that could sway a candidate your way even if your competition can offer more. 

In Conclusion:

Pay transparency laws are quickly becoming the norm. With this change comes the opportunity to revamp your recruitment strategy. By basing your open positions on what you can give the candidate that the competition can’t, you’re more likely to attract loyal candidates who will stick with your company for the long run. 

About Verified First
Verified First is known for delivering streamlined background screening backed by the best client support, and for developing the easiest, fastest HR system integrations, for free. Our client support team is U.S.-based, answers calls in seconds, resulting in hundreds of positive testimonials and a 96% customer satisfaction. Verified First's patent-pending, award-winning integrations include over 100 applicant tracking systems, and provide clients a turn-key experience.

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