LIHU‘E — A bill requiring Hawai‘i employers to disclose hourly rates or salary ranges in job postings was passed by the state Legislature earlier this month and is now awaiting final approval from Gov. Josh Green.
Aside from requiring pay rates in job advertisements, Senate Bill 1057 would also make it more difficult for employers to pay employees with the same job different rates of pay.
SB 1057 states that it would prohibit employers from discriminating between employees because of any protected category (including race, sex, gender identity, sexual orientation, age, religion), by paying some employees at a rate less than other employees who do similar work that “requires equal skill, effort and responsibility, and that are performed under similar working conditions.”
The measure would follow eight other states — California, Colorado, Connecticut, Maryland, Nevada, New York, Rhode Island and Washington — that have already implemented similar wage-transparency laws.
The bill has received a combination of support and criticism, according to
submitted testimony dated March 29, 2023. Supporters say the bill would narrow the gender wage gap and create equal pay, but critics argue that the measure would be bad for small businesses.
Carrie Ann Shirota, policy director for the American Civil Liberties Union Hawai‘i, wrote that SB 1057 would help achieve equal pay for equal work for women and other marginalized groups.
“Pay secrecy — the longstanding employer practice of withholding critical information about compensation, contributes to pay inequity,” she wrote. “Without access to compensation information, many job applicants are forced to negotiate their own salaries. As women and women of color are more affected by harmful stereotypes when they advocate for themselves, the act of negotiation often negatively impacts hiring, promotion and compensation.”
The Hawai‘i Civil Rights Commission also submitted testimony in support of the bill.
“Women and minorities have historically been paid lower salaries than their male non-minority counterparts, even for the performance of the same jobs. In the absence of pay transparency, it is difficult to level the playing field,” wrote commission Chair Liann Ebesugawa.
But Tina Yamaki, president of the Retail Merchants of Hawai‘i, was “respectfully opposed,” writing that SB 1057 would hurt small businesses.
“Measures like this may force small mom &pop businesses to close their doors, as this would be detrimental to small, local businesses who cannot compete with the higher salary being offered by some of the larger or nationally owned companies,” she wrote, adding that the bill “may spark jealousy and resentment” between employees.
Yamaki was also against the requirement for employees to be paid the same wage for similar jobs, stating that higher wages are often due to more experience, not discrimination.
“Retail has a lot of high school students working in our stores. We would also like to have flexibility on what we offer to those who are seeking their first job vs. those with experience. It is NOT based on someone’s religious belief, race, color, sexual identity, or orientation — it IS based on what the company can afford and what skills and experience the person has,” she wrote.
Representatives for the Society of Human Resource Management Hawai‘i, a nonprofit representing more than 600 members and employers, were also opposed to pay rates being required on job postings.
Dailyn Yanagida and Rosanne M. Nolan, co-chairs of the organization’s Legislative Affairs Committee, said the pay requirement would limit salary negotiation abilities between employers and employees and reduce the pool of qualified candidates.
“Posting a salary or range may unduly focus the potential applicant on only one aspect of the position,” wrote Nolan and Yanagida.
“Employers are competing for talent, often within the same industry or skill set. Requiring pay rates in job listings may remove their most competitive advantage,” adding that it could also create an “environment of mistrust” and an increased turnover rate for the employer.
The Chamber of Commerce Hawai‘i also submitted similar testimony against the measure.
SB 1057 was enrolled to Gov. Josh Green on May 4. If signed into law, the bill would take effect on Jan. 1, 2024.
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Emma Grunwald, reporter, can be reached 808-652-0638 or egrunwald@thegardenisland.com.
