Pay Transparency in Job Postings
Legal Alert: Employment Law
Washington’s Equal Pay and Opportunities Act (EPOA) was enacted in 2018. In 2023, the EPOA was amended to require certain employers to disclose wage scales and other compensation information, including benefits, in any job posting. The EPOA applies to employers with 15 or more employees, with at least one Washington-based employee.
If an employer violates the EPOA’s pay disclosure requirement, a job applicant or an employee may either file a complaint with the Department of Labor and Industries (L&I) or file a civil lawsuit against the non-compliant employer. Non-compliant employers may be liable for actual damages or statutory damages of $5,000, per violation, per applicant, whichever is greater, plus additional statutory penalties and attorney fees.
In a recent opinion in Floyd v. Insight Glob. LLC, No. 23-cv-1680-BJR, a federal judge, applying federal procedural law, clarified that plaintiffs would lack standing to sue in federal court under the EPOA if they are only “nominal applicant[s] with no interest in the position,” or are only applying to a non-compliant posting because they have the intent to sue. According to the Court in Floyd, to be harmed by a purported EPOA violation, a plaintiff must be a “bona fide” applicant and must allege, “at minimum, that they applied for the job with good-faith intent.” Note that the Court’s opinion in Floyd does not change the EPOA’s pay disclosure requirement, and employers should still ensure their postings comply.
What This Means for Employers
Even a single job posting in violation of the EPOA can lead to potentially significant liability. The Department of Labor and Industries has seen a dramatic increase in complaints being filed against employers alleging a violation of the pay transparency requirement. Additionally, more than 50 class action lawsuits have been filed thus far against employers in Washington. One of these lawsuits recently settled for $3.8 million where nearly 2,000 individuals applied to the employer’s non-compliant job postings.
If an employer unwittingly leaves a job posting online that fails to disclose pay or benefits information, dozens (or even hundreds) of individuals may submit applications. A single non-compliant job posting on Indeed.com, for example, can unintentionally lead to a class action lawsuit against the employer.
Employers should contact their counsel for direction on the EPOA and may want to do the following, at a minimum:
- Assess job postings on all platforms for compliance with the EPOA.
- Re-train individuals involved in drafting job posting language.