KEY TAKEAWAYS

• New York City has enacted two major pay data reporting laws that require large private employers (200+ NYC employees) to submit annual, detailed compensation reports.

• The data collected will be used by a designated city agency to conduct annual pay equity analyses, which may influence future enforcement actions and policy decisions related to pay equity.

• Employers should proactively evaluate their current pay data tracking processes, assess internal pay equity risks, and coordinate across departments to prepare for these new compliance obligations before the reporting requirements officially begin.

New York City is advancing pay transparency and equity in the workplace through the enactment of two important pay data reporting laws. These regulations will soon require large private employers operating within the city to submit comprehensive annual reports on employee compensation. The primary objective is to identify and address potential disparities in pay based on gender, race, or ethnicity, and to highlight industries where such differences may be prevalent.

Who Is Affected?

Private employers with 200 or more employees in New York City (including full-time, part-time, and temporary workers) are subject to these new requirements. Governmental entities are excluded from this mandate.

Pay Data Reporting (Int. No. 982-A)

Timeline

Within one year of the law’s effective date (no later than December 4, 2026), the mayor must designate a city agency to implement and oversee the pay data reporting laws.

No more than one year after being designated, the agency must create a standardized fillable form for pay data reporting. Employers may submit the report anonymously, but they must provide a signed statement to identify themselves and confirm the accuracy of the submission.

By one year after the standardized form is published (which could be as late as December 4, 2028), employers must begin submitting annual pay reports to the designated agency.  Notably, however, if the mayor designates a city agency soon, and the agency creates the standardized fillable form quickly, then these requirements could go into effect much sooner.

Pay Report Contents

The reporting form will adhere to standards established by the Equal Employment Opportunity Commission (EEOC) for its 2017 and 2018 EEO-1 Component 2 reports. This includes tracking wages and total hours worked by race, ethnicity, and gender across 12 defined pay bands.

The designated agency will have the authority to update reporting requirements as needed, including making provisions for different gender identities.

Employers may also include explanatory statements to clarify any information in their reports.

Statement of Accurate Information

An authorized representative of the employer must sign a statement confirming the pay report has been submitted and that all information provided is accurate.

Publication

Each year, the designated agency will publish on its website a list of employers who fail to comply with pay reporting requirements. Employers identified as non-compliant will receive notification and have 30 days to address any issues before their names are publicly disclosed.

Penalties

Employers who violate pay reporting requirements face civil penalties. For the first offense, employers will receive a written warning if they correct the violation within 30 days of notification. A failure to do so results in a $1,000 penalty. Each additional violation thereafter incurs a $5,000 penalty per offense.

Pay Equity Study (Int. No. 984-A)

One year after employers first submit pay reports, and every year thereafter, the designated agency, in collaboration with the Commission on Gender Equity and other relevant agencies, will conduct a pay equity study.

Purpose of Pay Equity Study

The pay equity study will analyze pay report data to determine if compensation disparities exist among employees based on gender, race, and/or ethnicity. It will also identify industries where disparities are common and report on trends in occupational segregation by gender, race, or ethnicity.

Findings

Within six months of completing the pay equity study, the designated agency must present its findings to the mayor and the speaker of the City Council. The resulting report will include: (a) an analysis of the data collected, including a statement of any disparities identified; (b) a description of all statistical methodologies used in the analysis; and (c) recommendations for employer action plans to address any disparities found.

The designated agency will release its recommendations publicly and publish aggregated pay report data, but they will take steps to ensure that no identifying information about employers or employees is disclosed.

Recommendations

Employers should evaluate current methods for tracking and categorizing pay data, assess internal pay equity risks across job categories, coordinate efforts among human resources, legal, and payroll departments, and develop plans to ensure data integrity, confidentiality, and proper certification procedures. Employers who begin preparations promptly will be better positioned to manage compliance risks and respond effectively once the reporting requirements officially take effect.

If you have questions about how this impacts your business, please contact:

• Scott R. Green
• Jason Greenfield
• Cali L. Chandiramani
• Christopher P. Maugans
• Caroline J. Berdzik
• Stephen C. Mazzara
• Or another member of the Employment and Labor team