Maryland’s businesses will be required to take an important step forward in salary transparency as Governor Moore signed HB649 into law April 25. Under the new law, which takes effect October 1, 2024, businesses must include a pay range in job postings. Executive Alliance advocated for this change, citing growing research that points to a reduction in gender pay gaps and increased wages for women after states and/or employers have enacted pay transparency policies. This is a best practice that helps businesses attract and retain employees by creating more transparency in the hiring process. It also helps ensure that pay is set fairly, which is a significant problem for women and especially women of color, who have significant pay gaps as compared to men.
A large group of advocates came together to support this legislation, which was a priority for the Women’s Caucus and the Maryland Legislative Agenda for Women. The National Women’s Law Center, The Maryland Center for Economic Policy and Maryland’s Department of Labor also testified on behalf of the bill. Polling from the National Women’s Law Center/Morning Consult revealed that 74% of Marylanders favor pay transparency and 53% have avoided applying to a job opening because it did not list a pay range.
Delegate Jennifer White-Holland, the House sponsor, said in her testimony “Women who negotiate pay tend to get turned down more often and end up with less than men who negotiate. Employers tend to perceive women who negotiate as greedy and aggressive, and some research shows that women often ask for less when they negotiate than men because they do not want to be negatively perceived. At the negotiation table, Forbes reports that women of color state dramatically lower minimum salary requirements than white men, white women, and men of color.
When job applicants are informed about the context for negotiations, like wage ranges, these gender differences in negotiation outcomes diminish. Requiring employers to be publicly transparent about pay ranges shines a light on employer pay practices, increases accountability on employers to set fair, non-exploitative wages, and promotes more formal pay practices. Wage transparency is a tool that our state can use to better position women to be informed about the negotiation context, saves time and resources for all workers on where to apply, and how to position themselves for success. Most importantly, further transparency is a tool that will allow us to address the racial and gender wage gap.”
Colorado was the first state to require pay information in job postings in 2021, quickly followed by California, Hawaii, New York, Washington, the District of Columbia and now Maryland. Virginia’s pay transparency bill was vetoed by Governor Glenn Youngkin in March.
Executive Alliance is a Maryland 501(c)(3) organization dedicated to accessing power as women leaders in Maryland’s workplace. We measure that power by representation in the c-suite, board room, and other places of power and nurture a network of women leaders that support each other in their development. Learn more at executivealliance.org.