A
recent story in the
Wall Street Journal raised questions about whether the new Colorado wage transparency law truly achieves its goals of narrowing gender wage gaps rather than simply providing public access to which companies pay the highest wages.
Colorado’s EPEW Act requires employers with at least one Colorado employee to provide wage rates or ranges and a general description of all benefits and other compensation in job postings for roles performed in Colorado – including, notably, remote jobs that can be performed in Colorado. The law is part of a trend of local pay transparency mandates, including in New York, California, Connecticut, Nevada, and other jurisdictions.
However, based on the WSJ article, one could conclude the primary effect of the law has been to make Colorado job postings a proxy for figuring out salary ranges for similar roles elsewhere. A report responding to the new Finnish law requiring companies to share employee pay data with other employees shows that gender pay disparity is caused by the pay gap between female- and male-dominated occupations and sectors, not lack of pay transparency.
Outlook: It is likely that pay transparency laws will continue to proliferate globally and within the United States on the state and local level, with a federal proposal potentially on the horizon as well. It remains an open question, however, just how effective such laws are at driving meaningful change in achieving greater gender pay equity.
