Pay Transparency Laws | Have You Considered All Implications?

Mary Rizzuti: So the overview of the course today while topic as pay transparency, and we will certainly go through that legislation. We also want to broaden the conversation as to the implications and maybe some areas that need to be addressed that people may not consider. We want to understand the legislation, but we want to understand the wider impact that it will have on your compensation programs. So we'll talk about the general provisions, we'll talk about the strategies around your salary range development, what a market study can and cannot provide as it relates to pay transparency and the general strategies that you can employ whether or not you're even covered by pay transparency, which is just really best practice and also to provide preparation in case at some point you will be covered by it. Certainly you're going to be competing for talent with other companies in other states that may also be covered by pay transparency. So this is going to give you a very wide lens into the pay transparency arena.

So we're going to talk a little bit about the timeline. So this pay transparency beginning, so Equal Pay Act of 1963, equal pay for equal work, which was followed then by Title vii, which was in 1964, and that was non-discrimination based on race, gender, and religion. Lily Ledbetter Fair Pay Act then was introduced in 2009. Then we had 2015, the pay equity legislation began to surface 2020. There were bans on requesting salary history in job applications in 2021. We had pay transparency legislation in Colorado. So this provides you with a timeline and also the sense of how we are continuing to pick up momentum in this pay legislation, focus, pay transparency, pay equity, and the importance again of looking at it through a much wider lens. Diana's going to go over the map of the United States and all of the pay transparency effects in all of the states for you.

Diana Neelman: Thanks, Mary. So to provide everyone with a visual of where we have pay transparency now in effect, this map here displays the states that either already have it on the books or that are going to be effective in 2025. So as Mary mentioned, Colorado was the first state to enact pay transparency rules, and that caused quite a bit of buzz among HR professionals and we've then started to see that filter through to a few other states. We have them on the west coast, we have them on the east coast here all the way out as far as Hawaii as well. And what we're looking at here, in addition to these listed states, there are also municipalities that have put through their own pay transparency rules. So whether or not they are covered statewide, for example, New York City and Jersey City put in rules. Jersey City actually proceeded New Jersey statewide in Pay transparency. So what we want to make sure of is that we're paying attention to the rules, we're paying attention to where our employees are sitting and making sure that we understand what it is that our HR teams need to do. As far as compliance for 2025, we're seeing a few states upcoming. If you're sitting in New Jersey, if you're a New Jersey employer, those rules actually go into effect one month from today. So hopefully those that are impacted have prepared and are ready to go once June 1st comes along.

So in addition to these 15 states, we're also seeing a number of states that have proposals for pay transparency. So these again are some states in the Mid-Atlantic in central US and also on the west coast, Oregon and Alaska. So we're looking at 10 states here. Once these go through, if and when they do go through, there will be 25 states total that will have some pay transparency rules on their books, which then provides for a very careful consideration of where your employees are coming from and what you need to do from a compliance standpoint.

Mary Rizzuti: Let's talk about, I'm sorry. So when we think about the pay transparency and what it is and why it's important, when the first legislation surfaced, there was panic, general panic that organizations were going to have to publish internally, all of the salaries of all of their employees. Employees feared that their compensation would also be made public. So it's very different in the private sector versus the public sector. In its simplest form, it's just openly sharing salary data for positions, not people. So that's a strong differentiation, but there's complexity to the pay transparency. We'll go over the nuances among several states because it does vary slightly by state, but in practical terms, it's going to enable an employer to clearly communicate pay ranges for positions. So compensation has always been a delicate area, both from the employer standpoint and the employee standpoint. People are hesitant to ask for an increase in salary employers or were less structured in maybe how they made their offers in a matrixed organization.

Compensation sits sometimes with different departments and they are independently making decisions on what to offer applicants, and this creates a lot of pay inequity internally, unintended consequence, but it does happen. So to be able to clearly communicate pay ranges for positions certainly is going to build a lot of trust internally, but also sets the organization up for a greater optic. From an applicant's perspective, it fosters an environment of fairness and internal equity. In the compensation world, we talk about market competitiveness and certainly in all of our years of working with clients, not everybody can pay market competitive salaries. Certainly there's comp philosophies that impact that, and sometimes it's just the financial position of an organization, but that doesn't mean that you can have internal equity within your organization. So you may choose a different market positioning from a competitive standpoint, but the most important part is to have internal equity.

It's going to be able to set these clear expectations around compensation for applicants, and in some cases also for current employees. You'll see that some of the legislation allows for employees to then ask for the salary ranges for their positions. It encourages fair and balanced salary negotiations. So back in the day it was a black box. You could apply for a position and many times we would be interviewing applicants and they would be honest and say, I don't really know what to ask for. Certainly if somebody was under compensated in their former position, they would bring that under compensation to the new position if they were going to negotiate based on what they were making in their former position. So this pay transparency legislation levels the playing field and really takes away any of that bias or any inconsequential impact of prior mistakes from prior employers. It also guides employers towards accountability. And accountability doesn't necessarily mean that someone is doing something that's unfair, but rather gives them time and space to kind of think about what exactly are we doing from a competitive standpoint? Where are we positioning ourselves? What tools do we have internally to measure internal equity? What do we have to move our employees through a salary range or through their career based on what we see as our own salary structure? So there's a lot of implications to pay transparency other than post arrange for an open position.

So what it means for employers is that they're going to have to open communication channels regarding pay that may not have existed before. So this is going to incur a lot of training, training with hr, training for managers, training for senior leadership. We need buy-in on exactly what this communication is going to look like. This then will in turn build a ton of trust because the employees will see that there is a commitment by the employer to have fair and equitable pay across the organization. Sometimes we see that there's this attitude of employees that applicants may be treated better than employees because they're trying to encourage applicants to join the employer. This again levels the playing field because they're going to be able to see what the pay range is and they will be looking at that, what the pay ranges are for open positions and be able to compare themselves there.

It'll support the organization's culture. So the culture will be set and this communication process will be built around the organization's culture. So it's a very cohesive approach. Again, I referenced the managers being trained properly, that's of utmost importance. We do a lot of manager training around how exactly to have these pay conversations and understanding how the pay is set internally. Many times we're focused on the business of the business, but it's certainly important for managers to understand what HR is doing on the comp side so that they can respect the process as well. We'll talk a little bit about performance management systems and how they should differentiate performance because this will then go back to the pay transparency. So if my compensation is a little bit different than what is being posted, I can at least connect that to the pay for performance system that I have been part of because we certainly know that performance impacts compensation and that's where that range is going to come in.

So we're going to look also at total rewards because aside from base pay, a lot of the legislation requires that you post also benefits and sometimes sales commissions and incentives. It's going to require additional work around market studies because if you're just looking at base pay and you're not really aware of the impact of the benefits or the competitiveness of the benefits that you're offering, this is going to be a good time to look at that. So again, a real holistic approach, a different view other than what should we pay this new applicant? It really has so many implications internally, some of the common provisions are again, a disclosure of a salary range in the job postings. So you have a low and a high. What's most important is that it's a reasonable range and not in good faith. In the beginning with New York City, we saw ranges that were 50,000 to 200,000 and they thought that that would satisfy the pay transparency requirements, but again, it really needs to be a reasonable range.

Disclose your job information. Some states require a job description to be posed well, New York City does requires that the actual job description be posted. Others are okay with say a thumbnail or an overview of the job information. Again, description of the benefit offerings and any additional comp programs like a commission plan. Third party recruiters are also subject to compliance with the pay transparency legislation with respect to remote positions, generally, if the position reports to a manager or supervisor that's in a state that is governed by pay legislation, pay transparency legislation, then a salary range needs to be posted. Occasional onsite work like having to visit for meetings or conferences isn't considered that. But again, we are seeing more and more states, even if they're not governed by pay transparency, starting to post salary ranges. Also covered by the legislation in some areas is posting promotional opportunities internally so that internal candidates also have a view into the compensation range for the position and the ability to apply for it. And as I said before, prohibited from requesting salary history from any applicant. Diana, if you'd like to just go over some of the nuances of the states.

Diana Neelman: Absolutely. Thanks, Mary. So this is just a handful of states that we've selected to highlight here, but I think you'll start to understand those nuances that we need to pay attention to in each of the states in which we have pay transparency laws. So as the baseline, we have the salary range posted in the job posting for external posting. So the four states highlighted here. Obviously those have to be provided in the job posting. Where we start to see some differentiation is in the remaining areas. So what do we need to disclose to current employees? So in California it's any position, Colorado, there is a requirement for notification for internal employees. Illinois actually specifies a timeframe for providing that notification to current employees and New Jersey is a reasonable effort. So again, being sure to understand what needs to be posted externally and what needs to be posted internally to remain compliant.

There are also items in the pay legislation regarding when an employee comes to you requesting their salary range for their current position. So as you can see, California and New Jersey, California is upon request. Colorado does not specify, but we'll talk later on about being prepared for that in case employees do come to you and what you should be thinking about Illinois and New Jersey. It's not required in Illinois and it's not specified in New Jersey. But again, you want to think about what you might want to do in that situation for remaining compensation outside of base salary, benefits, bonus tips, commissions, each state has their own requirements, although California it's not required, may want to think about if that provides you with a competitive edge to provide some information regarding your benefits. Colorado is a yes across the board. Illinois. Again, also, yes, but Illinois does not specify exactly commissions.

Some states where there is a job that would require commission only or a piece rate, the job posting has to include a reasonable range of that. So again, we want to pay attention to that. What I think is interesting is Colorado, and again, Colorado being the first state to put pay transparency laws on their books talks about career progression. If there is a career progression schedule, employees need to be advised of that and how they can move through that career path. So if there is one in place, Colorado employers must provide that information to their employees. So I think that's a nuance and a differentiation for Colorado. So again, it's not only about being onboarded with an appropriate salary range, but having an opportunity to progress through an organization by understanding what that pathway is. I had like to launch the second poll, so poll number two, if you could respond, are you currently covered by pay transparency laws either at the state or the municipal level? So please answer accordingly.

Mary Rizzuti: And while we are waiting for responses, I see a question. Is there a requirement to increase internal salaries if new hire salaries are higher? We have experienced this with our clients, it's called salary inversion. When we look at a census and we see some inequities, it's almost guaranteed that they were hired during 20 21, 20 22. So no, you don't have a requirement to increase them. What we're seeing now is the labor market changes is a little bit of a slowing down of those individuals who came in high and again, the movement of others to try to close that gap. But this legislation does not require you to level set that.

Diana Neelman: So just as far as the poll goes, we have about 44% of today's attendees being covered by some form of pay transparency, either at their state or municipal level. So good to hear that you have something that you can reference from a compliance standpoint. Let's talk about what's next. So you may have pay transparency or you may want to provide some sort of pay transparency, even if you're not required by state law, you want to think about what that means to you. You want to define that for your company. How does that going? How is it going to impact your salary administration? So first and foremost, we want to have a solid foundation to assess market competitiveness because as you can imagine, you're posting for a job opening, you provide a salary range, you want to be able to attract good talent. So you need to understand what your degree of market competitiveness is.

So first and foremost, defining your philosophy. Do you want to pay at market? Do you want to pay ahead of market? Do you want to pay at a different point in the market because you have other components of total rewards that could differentiate you? But again, as a baseline, we want to look at the salary information as well. So how we do that is to conduct a compensation study, but in preparation for that, we need to make sure that our job information is accurate. We want to make sure that we understand the duties and responsibilities of individual positions. If there are jobs that have similar titles but may have different bilities, how is that reflected in the job description? Because those differentiations may impact the pay levels. So we want to make sure that our job documentation accurately reflects what the position needs to be doing on a day-to-day basis.

The compensation study is going to provide that data foundation. So knowing what the market bears for different positions, looking at credible and empirical sources for data will enable you to be able in the future to defend your compensation decisions, whether that be your salary range or what you're putting in the job posting or how you're administering pay on an ongoing basis. So making sure that you look at sources that come from reputable organizations that are well vetted, that have appropriately matched data to your demographics, excuse me, whether it be your industry, your location, the size of your organization, there are survey sources that you can purchase. There are subscription services that you can subscribe to. There are other resources online as well as far as public disclosures of pay ranges. So having the ability to look at a broad range of compensation survey data to help you make your decisions, that data is then going to help you to define what your salary structure or your salary ranges may look like.

So we have a market anchor as far as the average, or again, aligned to your philosophy, what that midpoint should be and what is a range around that pay. We also want that to be a reasonable range because again, if we're looking at posting something in a job posting that we want to make every effort so that it does align with the good faith and a reasonable range job leveling. Again, we have some positions that may progress through a job, family and job levels. So we want to have appropriate ranges around that. And from a strategy perspective, what does that look like? Are we going to build a salary structure in the more traditional sense, meaning we have range spreads within a certain range or a fixed percentage spread? Are we going to have midpoint differentials? So in that construct, jobs with common market values would be in the same grade, or are we going to define individual ranges by position title?

And it works for some employers that way other employees, employers will use a salary structure. But again, using your data will help inform your next steps as far as what those ranges and what that form of the salary structure will look like. So these exercises then lead to an analysis of your employees. So while the market study helps us to prepare for pay transparency, it also causes us, us with the opportunity to look internally. So how do our employees line up to the market? How do they line up within the ranges? How do they line up with our philosophy? And does that then provide an opportunity to look at maybe some action, maybe realignment for internal equity or market adjustments? So there's a lot of information that can result from these exercises that will help you to define your salary administration and to help you explain your process and why you landed where you did. Mary, do you want to talk about the details now?

Mary Rizzuti: Sure. So I will just address one question that came in about clarity around pay transparency as it relates to where a remote employee sits versus where the headquarters is. So it's again where the headquarters is because remember, this is for applicants. So when you're posting a position, it's about where the headquarters sits. However, my recommendation would be if you're specifically looking to recruit someone from say, Jersey City, you should probably post the range because if they're applying to other positions in Jersey City, they're going to have the benefit of the range. But again, it's for applicants and again, also for the headquarters, you'll see more and more people are going to start asking what the range is because it's becoming almost commonplace that they're posted. Okay, so what do you post? So we've provided you with a sample salary range. This is from one of the structures that we built.

So some organizations call their salary ranges, the 25th, the midpoint and the 75th, and they get that information from a salary survey and they create ranges for each position. We build our salary structures a little bit differently because we like each range to be able to house more than one position because managing single positions in single ranges is difficult, and again, sometimes can create a little bit of internal inequity. So we build these salary structures, they have mid to mid progressions and they have range spreads very similar to a funnel for most organizations. So wider at the top and then it narrows as it goes down into the organization. For an organization that's a flat organization, many times we have static range spreads, which is usually about 50%. So this is an example of a minimum, a 25th, a midpoint, 75th and maximum. And you may say, well, why would I want to pay below the 25th percentile?

Interestingly, when we talk about career progression, many times the organization does make a decision sometimes more often with promotions to say, we want to grow this position, we want to move them to the next salary grade, but they need, they're on a learning curve, so we're going to start somewhere between the minimum 25th percentile, and then as they acquire more skills, and that goes to again, building a competency model, we can then move them through this grade. So when you're trying to decide what to post in your, include in your job posting, you look at your salary grade and then decide what's my sweet spot? So in this example, we said somewhere between the 25th percentile and the midpoint, and that seems to be a very common place where people start with the posting. What we recommend our clients do is before you decide where you're posting, look back at your population and slot them into this range.

So anyone who has a similar or same position that you're posting for, take that population and put them into this range. And if they don't fit, make sure you understand why are they above the range because they have a certain expertise that is valuable to the company. Do they have a performance issue so therefore they're below the range or are they still earlier in their career? And therefore a little bit below the range? Because I can assure you when you post this and people see it, you will receive questions as to why they are where they are within this range. And so sometimes what we'll have clients do is pick their spot in their salary range, do the analysis on current incumbents, and then you may want to widen this range a little bit to make sure that you're including your population as well, so that there isn't any unintended consequence on morale or the inherent value somebody feels within the organization.

I'm going to share with you job posting examples. So the first one is it specifies where the company is, what the expected salary range is for the position, but it also includes a disclaimer that in other geographies there may be a little bit of a difference here. So certainly if you're hiring someone in the New York City area versus Oklahoma, there's going to be a difference. It's going to be, again, based on experience, which again will lead back to those updated job descriptions. Most job descriptions will have required experience, and if you're bringing more experience to the position, it may impact the comp. Now, I say may because we've seen instances where somebody brings 20 years of experience to a particular position, but that additional experience doesn't necessarily add additional value to the position. So there is a threshold and there is a cap to the value of almost every position in an organization.

So again, very complex. It's not as easy as saying, we're going to pay 70 5K for this position. Really need to look internally and at the applicant. The next example is not my favorite. So it says in compliance with pay transparency requirements, the salary range for this role. And then they go and talk about which states is 86 to 159. I think that's a really wide range and would probably like to reword this a little bit because coming from Minnesota or coming from Maryland, where do I see myself within that range, not only from an experience perspective, but as an applicant, I may not understand what the impact of geography is on those ranges. So this is a little bit broader from my liking. And again, the next sentence is 98 to 182. Again, really wide range, and it talks about it's not a guarantee of salary.

There's other factors that will impact it, but I think as an applicant going in, it would be difficult for me to know what to ask for and how to negotiate. And because the other thing that may happen is I may think, okay, the top of the range is 180 2, I'm going to go in and ask for 180 2, what could go wrong? And I could exclude myself from the pool because it's an unreasonable expectation. So we want to be very mindful because the end goal is to get the best applicant in the shortest amount of time. So the more conscious we are of what we post, the better quality of the applicants we get and the sooner we get to a filled role.

Diana Neelman: I had like to launch the next poll, poll number three, regardless of whether you are governed by pay transparency, you provide salary ranges in your job postings. So please respond accordingly.

Mary Rizzuti: And while we are waiting for the response, if you'd like to start the next section,

Diana Neelman: So here are some of our responses. Again, we're also seeing about the same percentage here on postings. So almost half are actually putting something in their job postings, even if they're not governed by pat transparency. So that's certainly good. So let's talk about additional implications. And we touched upon this earlier on, communication takes many different forms and it's certainly part of a total reward strategy to make sure that you have a holistic and a comprehensive look and process for your total rewards. Again, defining what pay transparency means to you. What are you going to communicate? So are you going to talk about your compensation philosophy? Many organizations are very proud of their mission and vision statements, and they disseminate that widely throughout their organization. But also the compensation philosophy. How am I going to be aligned to the market? What is our pay for performance philosophy as an organization, as an employer?

How is market competitiveness defined? What are the benchmarks that are going to be used? What is the salary range that is going to be in effect for the various positions? How are pay increases put forth? Is it flat cola? And many organizations still do that where they may increase salaries by a flat percentage, but there might be some variable or bonus opportunity, or others have very formal processes where they're merit based and based on your performance rating, you'll receive a commensurate increase. So the question does come up Now, are you ready for pay for performance if you don't have it? So again, a consideration to enable an organization to provide compelling and reasonable compensation, and certainly recognize employees who perform above expectations. As we talked about earlier, pay equity is a consideration. We want to make sure that we're looking at those components as well. And what we may need to do to ensure that we have appropriate compensation for individual employees. So as Mary mentioned earlier, job postings are public and employees will see those. So we want to ensure that whatever we're posting externally, we can explain internally to employees if the questions get asked.

Part of the communication process is ensuring that there is appropriate education around the messaging for your total rewards, for your compensation structures, for your pay transparency initiatives. So making sure that managers understand the philosophy of the organization, what the salary administration guidelines are and their role in administering salary actions internally, performance management, this is an ongoing concern for organizations that do have formal processes to make sure that managers across the organization are implementing it consistently and objectively. And then certainly all this leads to pay transparency and pay transparency compliance. So this impact on salary administration, so we talked about just the communication, but thinking about what happens in an event that you have a one-off salary negotiation. What you need to ensure is that you understand what the impact of that decision may be, and there may be reasons and justifiable explanations for making those decisions.

So those should be known and being able to defend that to current employees beyond the legislation, we talked a little bit about remote employees and being able to see your job postings or lack of job postings, so that may limit or expand your applicant pool. Your pay philosophy is an important piece of that. There's a balance that needs to be maintained around all these pieces. So making sure you're disseminating enough information balanced with your internal processes. Part of pay transparency, pay equity compliance with various payroll is just ensuring that you're looking at your compensation structure to maintain competitiveness or your degree of competitiveness. So again, looking at how frequently do you want to review market rates, how does that impact not only base salary reviews, but incentives, making sure your performance management processes are up to date, understanding where they're working and where they may need to be fine tuned, looking at your job information, and again, the job information leads to appropriate market values and the definition of an appropriate salary range.

So keeping on top of those because jobs do shift, so we want to make sure that our job documentation recognizes any shifts and understanding what is coming from your employees and from your managers, what feedback are they giving you? Is it positive feedback, which means you're doing a great job? Are there areas though that have been addressed with HR that maybe will cause us to take a step back and reassess our processes? So this is a fluid process. This is an ongoing process. It should not be one and done. It shouldn't be static. It should be something that becomes part of the fabric of your salary administration process. We talk about leadership commitment not only in compensation plan design, but here as well. So ensuring that leadership understands pay transparency regulations, pay equity regulations, giving them the data so they may understand where the organization sits from a market competitiveness, ensuring compliance with the rules so that they're able to buy in and support the process on an ongoing basis.

Mary Rizzuti: Okay, so here's your homework. So this is, we call it a pay transparency cycle. It's not really chronological and it's a cycle because one thing begets another, but I would use this as a checklist. And if you're looking for new projects to undertake, if you're in the HR space here they are in front of you. So define base pay. So that would be likely a market study. Define your positioning. And again, if it can't be at the 50th percentile, it can be anything that you want it to be, but as long as it's consistent and non-discriminatory, build a salary structure. I think that having market data separate and apart from a salary structure limits you to such a tight range. We want to widen the range so that you have a lot of flexibility within your organization to manage compensation and to define those compensation decisions, both externally and internally.

This is a difficult one to decide on your pay for performance environment. It includes a merit increase. We do something called a merit increase matrix that looks at a person's positioning within a salary structure and their performance rating, and then that then begets what the salary increase would be. You don't necessarily have to be that specific, but there should be some differentiation in the performance increases. And this goes back to the earlier question that if somebody was brought in higher because of the market, this is your opportunity to kind of them too, because don't forget, you're calculating that percent increase from a higher base salary. So it will also give a higher increase, but again, it'll start to slow it down a little bit, ensure accurate job descriptions, because again, if there's a question about why is my compensation different from what you posted, there could be a difference in the job that the individual is performing and the job description should reflect that.

So it's not everybody's favorite thing to do, but we like to encourage our clients to review your job descriptions every year as we see some rifts happening and some or redesign happening, sometimes the job descriptions get left on the shelf. New job descriptions are created for new positions that come out of the reorg. And then there's confusion as to who is attached to what job description. So again, that's an annual thing that should be done. Building a job. Architecture also is important for retention. So career progression, career development, training and development programs. What should we be focusing on if we want to have this less flat organization with movement for all positions? So in the manufacturing space, sometimes it's difficult to have, say production positions have career progressions, but we've spent a lot of time doing leveling. And we then go to the next circle, which is your competency model.

And we spend, again, a lot of time making sure that we can identify the difference between a production worker, one, two, and three, beyond just being in the seat for a certain number of years. It's important for that job satisfaction. It's important again for retention and really for leveraging somebody's skillset to the maximum capabilities of the individual and the demands of the organization. So the competency models do take a lot of time. We call them a model. We design everything from scratch because every organization is different. But if you start with the job description and leverage that, and again, that then begets that your job descriptions are up to date, you can take those, create your competency models and build a really nice career progression for almost every position in your organization. And then you can overlay the individual ranges that you're going to be posting within all of this work that you've done. And then you can confidently answer any questions that are pose to you both from applicants and internal incumbents.

Diana Neelman: Thanks, Mary. We've reached our final poll question, so please answer, how prepared do you feel you are to address your pay transparency methodology? Very prepared, somewhat prepared, or not prepared. So while you answer the poll, let's talk about preparing for change. So here's the poll responses. I'm sorry, jumping ahead a little bit about half the group is somewhat prepared, and again, there's a lot of details within the pay transparency, so it's okay, and we're hoping that you get some good information today to help you feel better prepared. So talking about preparing for change, thinking about what happens if you're not prepared or maybe not prepared enough, it's going to impact your ability to compete for talent so that applicant pool may shrink for you and it may result in some deterioration of trust. So again, for those job postings where information is provided to existing employees, we want to make sure that everything is credible and that we can stand by it needing to be prepared as far as your communication.

So as an employer, what is our value proposition and how are we communicating that both internally to our employees and externally to our applicants? Trying to build a process for giving you an opportunity to get the best and the brightest talent within your organization. Compliance, again, reinforcing the messaging around having accurate job information, being market competitiveness or aligned to your philosophy, having appropriate pay ranges and benefits, having that performance evaluation process in place if you are a pay for performance employer, looking at recruitment and talent acquisition strategies that are impactful and provide you with the ability to have a good set of applications for particular positions and those career paths, the competency models, the job architecture, again, providing you with ways once applicants come on board to be able to retain them so they see the benefit of career progression within your organization. So again, something to contemplate if you're not covered by pay transparency, what would you do if an employee asked you for information? Thinking about what those strategies are. Are you going to provide a full range? Are you going to provide, what would be in a job posting? Have you looked at where your employees are against one another and against the market? So understanding all those inputs so that you can provide a compelling and a justifiable response.

Mary has a great case study that I'm going to pass over to her to talk about this change preparation and when an employer was a little bit too hasty,

Mary Rizzuti: And again, this brings this all back to reality. So I had a client several years ago, New York City, very large, well-known organization, and if you remember, New York City Pay transparency went and fits and starts. It was happening, it wasn't happening. And then all of a sudden it was happening. So this well-meaning HR director posted ranges. They had about eight positions open, so she posted the ranges for the positions on a Friday. I got a call on Sunday, and she was not a client at the time. She got my name from the internet and she said, she's having a rebellion. So they did not have anything internally in place. Now, salary structures never did a market study. And the incumbents saw these ranges, and they were so far outside of what anybody was making in the organization. She posted a very wide range just to be able to cover whatever the range might be for that position.

But the incumbents decided that that was the range of that position, and nobody was even close to that compensation range. And so we had to literally, and this was an organization of almost a thousand employees, we had to do a market study, salary structure, job descriptions, career progression in a matter of a week to quell all of the complications of what happened in addition to an enormous spend to bring everyone up to what she posted as the range. So a ton of implications, unfortunate learning experience for the individual, but again, that was one of the first and really happened so quickly that it was difficult to be prepared.

Diana Neelman: Thanks, Mary. Last polling question. Last polling question. So number four was not the last polling question, but here we are. So number five, will you be considering any changes to your pay program in the midst of new legislation? So please answer at your convenience

Mary Rizzuti: And a question about who monitors the laws. So if I am applying to a position that was posted, I would go to the labor department and say that there is no range posted. So it's really self-governance, but there are agencies that are looking, particularly the labor organizations. Any other questions? We have three minutes,

Diana Neelman: Mary. There's a question here. Somebody is asking, if I don't have the budget, what can I do?

Mary Rizzuti: So again, as long as you decide where you want to be and you have internal equity, the budget for salaries is whatever the organization can afford. It's really about posting a realistic range. And again, if you are on the lower end of the market, it's going to be within what you can afford. You want to just again, look back at the incumbents and make sure that you have everybody within that range. And there's other ways to attract talent. There's benefits, there's work-life balance. There are non-monetary ways to attract talent. Any other questions?

Diana Neelman: Thank you. Thank you.

^{Transcribed by Rev.com AI}