New Jersey Pay Transparency Laws: What You Need to Know

The topic of pay equity continues to gain attention across the United States, and New Jersey (NJ) is no exception. In fact, NJ is preparing to implement a new pay transparency law that will take effect on June 1, 2025. In short, this new law will require certain employers to disclose salary ranges in job postings and provide current employees with notifications of promotional opportunities.  

By mandating more pay transparency, New Jersey seeks to improve pay equity and give workers more insight into potential earnings and benefits. Let’s review the specifics of New Jersey’s upcoming pay transparency law, what it means for employers, and how Human Resources (HR) can help prepare their organizations for these changes.  

Overview of New Jersey’s Pay Transparency Law 

The New Jersey Pay Transparency Law is set to take effect on June 1, 2025, and it will require employers with 10 or more employees* over 20 calendar weeks that do business, employ workers, or take applications of employment within the state of NJ to include pay range information in job postings and to communicate promotional opportunities to current employees. These changes will apply to both external and internal job postings, which is a major shift from their current process in how employers handle compensation details.  

*The law does not specify whether the 10-employee minimum includes employees located outside of New Jersey. 

The law’s primary objective is to ensure greater pay equity by making compensation information more accessible and transparent. With these new requirements, both prospective and current employees will have a clearer understanding of the pay and benefits available to them, allowing them to make more informed decisions about their potential job opportunities. 

It’s important to note that while the law mandates disclosure, it does still offer some flexibility. Employers need to be transparent, but they can offer higher compensation and additional or enhanced benefits from what they initially communicated or disclosed. This is where HR needs to partner with the hiring managers to make sure pay decisions are well thought out, fair and equitable, and in compliance with the new law. 

Key Provisions for Employers 

Let’s take a closer look at the core provisions of the new law and what they mean for employers in New Jersey. 

Pay Disclosure in Job Postings 

One of the most important aspects of the New Jersey Pay Transparency Law is the requirement for employers to include salary ranges in all job postings, both external and internal. This means that any time a job is posted, whether it’s being advertised to the public or offered as an internal promotion, the employer must include the expected pay range for the role. 

Again, the law applies to all employers with 10 or more employees (over 20 calendar weeks that do business, employ workers, or take applications of employment within the state of NJ), so even smaller companies with fewer than 50 employees will need to adjust their hiring practices. The disclosure must include either a specific salary range or an hourly wage, depending on how compensation is structured for the role. Specifically: 

• Salary Range Details: Employers must list a minimum and maximum salary that they plan to offer for the position. This will provide job seekers transparency about the expected compensation level. 

• Benefit Information: In addition to salary ranges, employers must include “general” information about benefits or other compensation offered with the role. This includes health insurance, bonuses, retirement benefits, and any other financial incentives. 

Internal Announcement of Promotional Opportunities 

Another key requirement under the new law is the obligation for employers to disclose promotional opportunities within their organization. Employers need to make sure that internal employees are informed of available promotions that could involve an increase in compensation or a new title. These promotions must be communicated clearly so all employees have access to the same career opportunities. 

The law mandates that employers provide “reasonable efforts” to announce these internal job opportunities to current employees, especially those in the department or role being impacted. This includes posting internal notices on job boards or sending email announcements to relevant employees. Once again, this is where HR can add value and partner with the business on this. Other key points include: 

• Communication Methods: Employers can use various communication methods to make employees aware of promotional opportunities, such as email announcements, internal job boards, or intranet postings. 

• Exceptions to the Rule: There are some exceptions to the promotional disclosure requirement. For example, the law does not require employers to notify employees of promotions based solely on years of experience or “emergency” and last-minute promotions arising from unforeseen circumstances (such as the sudden departure of an employee). 

Which Employers Are Affected? 

The New Jersey Pay Transparency Law applies to employers with 10 or more employees in the state. This includes businesses, staffing agencies, and temporary help services, as long as they have at least 10 employees working for 20 or more calendar weeks in New Jersey. This coverage means that many businesses across various industries will be subject to the law, even those with small teams. 

For temporary agencies and consulting firms, the law requires compensation and benefit information to be shared with potential employees during the hiring process, even though these employers do not have to include salary ranges in public job postings for positions that might not yet be open. 

Employers who fall under the 10-employee threshold are not required to comply with the law. However, businesses should monitor whether future legislation could extend requirements to smaller employers, especially as pay transparency continues to gain more traction across the country. 

Enforcement and Penalties 

Employers who fail to comply with the New Jersey Pay Transparency Law could face significant penalties. The New Jersey Department of Labor and Workforce Development will be the primary agency responsible for enforcement. If employers are found in violation of the law, they could face: 

• A $300 fine for the first violation 

• A $600 fine for each subsequent violation 

It’s important to note that the law does not grant employees the right to file lawsuits against employers for non-compliance. Instead, the state will take enforcement actions, which means employers must be prepared for possible audits or investigations. 

To avoid penalties, HR teams should take proactive steps to ensure that job postings and internal promotional announcements comply with the law. Regular audits and review of job postings and compensation information will help confirm that employers are meeting the new requirements. 

Best Practices for Employers 

As New Jersey employers prepare for the law’s effective date, HR departments should begin to implement several best practices to ensure compliance: 

1. Revise Job Postings: HR teams should update all job posting templates to include the required salary ranges and benefits information. HR should also make sure that job postings are regularly reviewed for compliance. 
2. Announce Promotional Opportunities: Establish clear communication channels for promoting internal opportunities. Whether it’s through job boards, email announcements, or meetings, make sure employees are aware of the opportunities available to them. 
3. Train Hiring Managers: Train hiring managers, recruiters, and any other key players, so they understand the new pay transparency requirements. This includes ensuring that salary information is shared with candidates early in the hiring process and that salary histories are not asked during interviews. 
4. Conduct Pay Equity Audits: Employers should consider conducting a pay equity audit to evaluate their compensation practices. This will help identify any disparities in pay across gender, race, or other protected categories and confirm alignment with the law’s goals of promoting fairness. 
5. Review Existing Compensation Structures: HR teams should also take this opportunity to review current pay structures to make sure they are competitive and aligned with market standards. Adjusting compensation practices now will not only help with compliance but also attract and retain top talent. 
6. Ensure Compliance Across All Locations: For companies with offices in other states, it’s important to be aware of different pay transparency laws that may apply in those states. Consult our Ultimate Guide to Pay Transparency Laws by State if you operate in more than one state to see what your obligations are.  

What New Jersey Pay Transparency Laws Mean for Your Organization 

The New Jersey Pay Transparency Law, set to take effect on June 1, 2025, represents a significant shift in how employers need to handle compensation and internal promotions. The law seeks to enhance pay equity and support fair treatment of workers by requiring salary ranges in job postings and mandatory announcements of promotional opportunities,  

With the deadline for compliance quickly approaching, now is the time for HR to work with their New Jersey employers and start making the necessary adjustments. By reviewing job posting practices, enhancing internal promotion processes, and conducting pay audits, employers can meet the requirements of the new law and avoid costly penalties. 

In order to remain compliant, consider consulting with compliance experts or conducting a pay equity audit to ensure that your pay practices align with the law. Staying ahead of the changes will position your organization as a leader in fairness and transparency. OutSolve welcomes partnering with your organization to help with these new and critical requirements.