Insight

How Colorado’s Wage Transparency Laws Set the National Tone

Best Lawyers highlights how Colorado's recent wage transparency laws could prompt future PERM-based legislation.

Small figurines stand on stacks of coins
GS

Gregory Sirico

March 3, 2023 12:00 AM

As of January 1, 2023, three new states—including California, Rhode Island and Washington—have joined the ranks of many other states, counties and city districts currently working to enact laws surrounding salary and wage transparency. State lawmakers passed these laws to give workers from the public and private sectors increased leverage in future wage negotiations and to work towards closing longstanding wage gaps. For nearly a decade, many new laws have passed that have protected prospective applicants seeking employment, namely in 2016 when Massachusetts became the first state to prohibit any employer from inquiring about an applicant’s salary history before extending a job offer.

With new wage transparency laws quickly cropping up nationwide, employers and legal experts alike are left questioning how these laws will affect the permanent labor certification (PERM) process, a requirement for certain employers seeking to sponsor foreign nationals. Moreover, to what extent will these laws lead employers to reconsider their current job advertisement strategy both here and abroad? For now, the answer to that question is still left pending. What can be known for certain is the exact catalyst for the nation’s sudden shift towards wage transparency and PERM-based legislation.

Despite being enacted well after Massachusetts’s inquiry-based wage laws in 2021, it was Colorado that became the first U.S. state to enact wage transparency legislation that would directly impact the status of PERM advertisements. Starting January 1 of that year, all Colorado employers with at least one full-time employee were required to disclose both hourly rate and overall salary range and provide a general description of benefits. The labor certification process, or PERM, refers to the standard labor market test conducted by the U.S. Department of Labor (DOL) if no U.S. workers are willing or available to undertake a position when a company seeks to hire a foreign national on a full-time basis. Heavily regulated by the DOL, the PERM process and its requirements are directly impacted by state and local wage transparency laws now more than ever by not offering foreign nationals the same transparency.

Andrew Wilson, a partner at Buffalo-based immigration firm Lippes Mathias LLP, believes that federal salary disclosure requirements not applying to PERM job postings could drastically change the legal landscape for immigration practices around the country. "Immigration attorneys or the internal staff that initiate PERM proceedings may not have external job postings with salary ranges on their mind or their checklist because they have never done that before. It's not necessarily a huge hurdle to overcome, but it's new and not part of the routine yet. There are different pay transparency rules in different jurisdictions, and it will catch someone off guard if they're not careful. Those preparing PERM cases can't move forward with PERM advertising without checking what the local laws are to see whether a salary range is required,” stated Wilson, as reported by Society for Human Resource Management.

With more states likely to enact wage and salary transparency laws, U.S. employers facing the PERM process will continue to deal with countless requirements. Unless federally exempt or preempted by a newly enacted law, PERM regulations will drastically begin to affect the current status of foreign legal recruitment across the country.

Headline Image: Adobe Stock/Hyejin Kang

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