Pay-transparency laws do not work as advertised

Which is a pity, as California and Washington have just adopted them

FILE -- Employees return to the Goldman Sachs building in New York, June 18, 2021. Employers who had been growing bolder in their plans -- reopening offices, mandating or strongly suggesting that workers report back, promising holiday blowouts -- are now scaling back their ambitions for in-person business and socializing and bracing for an Omicron surge. (Jeenah Moon/The New York Times)Credit: New York Times / Redux / eyevineFor further information please contact eyevinetel: +44 (0) 20 8709 8709e-mail: info@eyevine.comwww.eyevine.com — Image: Eyevine

Jan 5th 2023

THE SALARY negotiation has long been one of the trickiest parts of hiring or being hired. Ask for too little and you may leave money on the table; ask for too much and you may not be offered the job at all. In America, this delicate balancing act is becoming less perilous. On January 1st California and Washington became the latest states in the country to require employers to include minimum and maximum pay ranges in all job advertisements. Similar laws aimed at levelling the playing field in salary negotiations and reducing gender and racial pay gaps have been passed in Colorado, New York and a handful of cities. In November New York City began enforcing its own law. Yet despite the popularity of such pay-transparency laws—they now cover roughly a fifth of the American labour force—their effects are still widely misunderstood.

This article appeared in the United States section of the print edition under the headline “Wealth warning ”