California recently passed a law that requires companies with more than 15 employees to post salary information for job openings. This affects hourly and temporary work and higher-paying technology executive positions. It is now possible to see top tech companies’ salaries. For example, a program manager in Apple’s augmented reality group will receive base pay between $121,000 and $230,000 per year. Conversely, a mid-career software engineer at Google Health can expect to make between $126,000 and $190,000 per year. A director of software engineering at Meta leading teams building network infrastructure will make at least $253,000 and as much as $327,000 in salary per year.
It is hoped that California’s pay transparency law will reduce gender and race pay gaps and help minorities and women better compete in the labor market. According to US Census data, women earn about 83 cents for every dollar a man earns, so having salary information available can allow individuals to see if they are being underpaid.
Despite its potential utility, the new law might only tell part of the story of job compensation. Companies can choose to display wide pay ranges, and it does not require them to reveal bonuses or equity compensation. Additionally, some employers may be reluctant to post salaries if they fear creating bidding wars for top talent.
A spokesperson from Meta said their latest analysis confirms that they continue to have pay equity across genders globally and by race in the US for people in similar jobs and that they pay full-time employees’ cash and equity. Apple and Google have yet to comment on the new law.
The implications of this new legislation remain to be seen, but ultimately it could prove a powerful tool for reducing wage inequality.
California Senate Bill No. 1162 was passed in September and went into effect on Jan. 1, introducing two primary components to the new law. Companies with more than 15 employees must include paying transparency on job listings, while companies over 100 must submit a detailed salary report to the state. These reports must record wage history and job titles, which can be inspected by California’s labor commissioner and can result in fines if employers are found violating any equal pay laws.
The purpose of the law is to help narrow pay gaps between different races, sexes, and job categories by giving people information so they can better negotiate for their wages or determine if they are being underpaid. It will also help California compete against other states that don’t require employers to post salaries. The law could also encourage companies to raise wages if they see rival businesses offering higher salaries or even choose to post salary ranges on job listings where it’s not required.
Ultimately, helping ensure women and people of color are getting paid equally will help the economy of California by increasing the earning power of individuals and how they can contribute in markets such as sales, housing, and investments. Complying with equal pay laws is essential for a thriving economy.
REFERENCES:
California forces companies to show pay on job listings, revealing big tech salaries
https://www.cnbc.com/2023/01/05/heres-how-much-top-tech-jobs-in-california-pay-according-to-job-ads.html
