Faced With Pay Transparency Laws, Companies Are Lowering Posted Salaries

Have you ever gone through the frustration of applying for a job and going through the interview process only to learn the salary being offered just isn't what you're looking for? Wouldn't it be nice if companies could just list salaries as part of their job postings so you don't have to jump through hoops only to realize the number in question doesn't work for you?

Well, in some states, listing salaries on a job posting is actually required. And that's a good thing.

Say you need a minimum salary of $60,000 to be able to pay your mortgage loan and other bills. If you were to find a job that seems interesting with a salary range of $40,000 to $50,000, you'd know right off the bat not to apply. If that same job were to post a range of $60,000 to $65,000, you'd no doubt be more interested.

But while it's a positive thing that some states require employers to be transparent about pay upfront, that rule seems to be backfiring in some cases. Here's why.

Employers are adjusting in an unfavorable way

The reason companies are often loath to list salaries on their job postings is that they don't want to commit to a certain wage upfront. Often, employers will offer up a wage based on a given candidate's qualifications and how badly they want that candidate.

New laws make it so that some employers have to list a salary range when they post a job. But what many have been doing in light of that is posting lower salaries to fulfill that requirement.

ZipRecruiter, for example, has found that 48% of companies have lowered pay bands for some roles in the past year in light of this new requirement. That doesn't really benefit job-seekers.

Some employers aren't complying at all

While some companies are offering up lower salaries to adjust to new pay transparency laws, a good 30% to 40% of those subject to these laws just aren't complying at all, says Revelio Labs, a workforce analytics firm. That's a problem, too.

On a positive note, a good 40% of companies have taken to posting salaries for jobs even in states that don't impose that requirement, according to Revelio. And doing so really does work to everyone's benefit.

Employers don't have to waste their time vetting candidates who are only going to say no to a job whose salary isn't sufficient. Applicants don't have to waste their time in that scenario, either.

Should you apply for a job whose salary range doesn't meet your needs?

You may come across a job listing that seems perfect for you, only to see that the salary range isn't conducive to you paying your bills and meeting your goals for your savings account balance. If that's the case, don't write off that job right away.

If the salary range is reasonably close to where you want to be but not quite there, perhaps the company in question has a little leeway to bump that number up. But if the salary range is way off, then you may not want to bother applying.

So let's say you need a $60,000 salary. If you see a job that interests you with a range of $45,000 to $55,000, then it could pay to apply, because $60,000 isn't so far off from the top of that range. But if you're seeing a range of $40,000 to $50,000, that's a wider gap to bridge.

All told, these new pay transparency laws are good for job searchers, but only to a point. It's frustrating that some companies are adjusting to these rules by offering lower salaries. But on a positive note, at least this way, job seekers can weed out positions that just don't cut it from a wage perspective.