How to Prepare for New Jersey's Pay Transparency Law

By Sara Schmidt and Ryan Funsch

Effective June 1, 2025, New Jersey will require employers to post a salary range on their job postings, adding to the growing list of states and municipalities that already have enacted pay transparency laws. 

Governor Murphy signed Senate Bill 2310 on November 18, 2024, which will require all New Jersey businesses with 10 or more employees to include in all job postings for a new position, promotion, or transfer opportunity wage or salary information, or a compensation range, a description of all benefits, and other compensation programs for which the position will be eligible.

The law requires employers to make reasonable efforts to announce, post, or otherwise make known any opportunities for promotion that are advertised either internally within the organization or externally through internet-based advertisements, postings, printed flyers, or other similar advertisements to all current employees in the affected department(s) in the organization before making a promotion decision. Employers are not required to notify a current employee of any promotion awarded based on years of experience or prior performance. 

This new law does not supersede local pay transparency laws. Jersey City has its own pay transparency ordinance, which has been in effect since 2022, whereby employers with five or more employees (including staff and independent contractors) must inform applicants of the minimum and maximum base salary or hourly wage and the job benefits being offered in all job postings – print or digital.  

What Is the Correct Salary Range to Post? 

To see that the most appropriate salary range is posted for a position, confirm that salary ranges are up-to-date, competitive, market-driven, and aligned with the organization's business needs. The posted range should be wide enough to include current incumbents' salaries while balancing the demands of the external market. This exercise often leads to the need for a full-scale compensation review to harmonize ranges that will be posted for new hires with the salaries of current incumbents. 

It is a common practice for employers with formal salary ranges in place to post the portion of the range for which they reasonably expect to make the offer. Compensation Resources suggests setting a target hiring range philosophy (e.g., advertising the 25th to 50th percentile of the salary range) and using that spread consistently across all positions and levels. However, we recognize that there may be certain situations where a candidate is under and/or overqualified for a position, causing the salary to fall outside the posted range. We recommend adding a disclaimer to the job posting for these instances.  

Steps to Take Before June 2025 

To prepare for the new pay transparency regulations, consider: 

• Conducting a salary audit to address inequities, such as pay gaps, compression issues, or market adjustments. 

• Reviewing and updating job descriptions and postings to include the appropriate duties and responsibilities. 

• Providing communications to employees relative to the organization's methodology for determining compensation. 

Communicating Pay Transparency to Your Employees 

Once salary ranges are included within the job postings, it is expected that current staff will request information about their compensation. According to a survey conducted by SHRM, 36% of organizations said that adding pay transparency to job postings caused more current employees to ask about receiving a pay raise.1 HR departments should prepare by making sure the organization has an up-to-date salary structure that reflects realistic market ranges. Questions from all levels of the organization will arise, and the compensation team should be ready with defensible data and an easily communicated methodology to support the ranges.  

Employees often use data found on public postings for a similar position. Defending your organization's methodology with empirical data based on generally accepted compensation practices will go a long way in building employee trust. Management must be educated on how to field compensation-related questions such as potential increases or an explanation of their placement within the full salary range. 

Importance of Maintaining Market Driven Pay Ranges 

It is most important that an organization has current base salary market ranges and/or a salary structure supported by market data. Positions should be accurately benchmarked to the correct market position representative of its size, industry, and location. All positions in the salary structure should be assigned to appropriate grades according to market value, internal hierarchy, and job impact. While pay transparency legislation is the catalyst for change for many organizations, it’s best practice to take a proactive approach in reviewing and updating current compensation processes on an ongoing basis.