Pennsylvania Pay Transparency & Pay Equity Laws: Complete 2025 Compliance Guide

Pennsylvania's pay transparency efforts are gaining momentum but remain under development. The state has yet to implement a mandatory requirement for disclosing pay ranges in job postings, but legislative actions like HB 560 highlight growing interest in such measures. HB 560 specifically proposes that employers provide salary ranges in job advertisements and make pay information accessible to job candidates who request it. The bill reflects an increasing push to align Pennsylvania with other states prioritizing pay equity.

The broader goal of these legislative initiatives is to address wage inequities that persist across industries. Pay transparency laws aim to eliminate barriers caused by salary history and promote fair compensation practices. In Pennsylvania, lawmakers are focusing on creating conditions where employees can negotiate pay based on the value of their role rather than previous earnings, ultimately fostering workplace fairness and equity.

Key Legislation: HB 560 and Pay Equity Proposals

HB 560 outlines clear requirements for employers to promote pay transparency and equity in Pennsylvania. It establishes specific guidelines for salary disclosures and aims to reduce wage disparities for employees and job seekers alike.

Employer Compliance

The proposed law applies to organizations with 15 or more employees. Employers of this size must follow the outlined requirements to ensure compliance. Smaller businesses are excluded from these obligations but may still benefit from adopting similar practices to foster transparency.

Salary Range Disclosure Requirements

Employers falling under HB 560's scope must provide salary ranges in specific situations:

• Job Postings: Every job listing, whether internal or external, must include a defined salary range. This range should represent the compensation the employer reasonably expects to pay for the position.

• Promotions and Transfers: When offering employees a new role or promotion, employers must share the salary range for the position. This ensures employees have a clear understanding of their earning potential before accepting the role.

These requirements aim to eliminate guesswork for candidates and employees, offering straightforward access to pay information.

Methods of Disclosure

The proposed legislation allows employers to disclose salary ranges either verbally or in writing. However, written disclosure is required when including salary information in job postings. For verbal disclosures, employers must respond promptly and accurately when someone requests this information.

By requiring employers to be transparent about pay, HB 560 seeks to create a more equitable hiring and promotion process. Employees and candidates can make informed decisions with a clear understanding of compensation, fostering trust and fairness in the workplace.

Employer Responsibilities Under Pennsylvania Law

Employers in Pennsylvania may soon face specific obligations to promote pay transparency and fairness. Compliance will likely require proactive measures and clear communication to meet upcoming standards effectively.

Annual Written Salary Disclosure

Employers with covered roles must provide written salary ranges to employees annually if required by law. This written record ensures every employee has access to clear, accurate information about their position's pay structure. Each salary range must reflect genuine figures based on the organization's compensation plan, avoiding inflated or misleading amounts.

Providing a written document eliminates confusion and establishes consistency across the workforce. Employees can rely on this documentation to understand their pay and evaluate any adjustments against their expectations.

Specific Salary Range Requirements

Clarity is key when disclosing salary information. Employers cannot rely on vague language like "competitive pay" or "negotiable salary." Instead, specific figures must be disclosed, such as "$55,000 - $65,000 annually." Employers should also avoid setting ranges so wide they lose meaning. For example, a range like "$45,000 - $100,000" could draw scrutiny if it doesn't align with realistic compensation.

For roles with variable pay, such as those including commission or bonuses, employers may need to provide additional details. Any supplemental earnings should be clearly explained to ensure employees fully understand their earning potential.

Anti-Retaliation Measures and Worker Protections

Pay transparency policies include safeguards for employees who inquire about salaries or discuss compensation with coworkers. Employers cannot retaliate against individuals who ask for salary information, report discrepancies, or engage in pay-related discussions. These protections are designed to foster openness and trust within the workplace.

To align with these expectations, employers should implement policies that explicitly prohibit retaliation. Training HR teams and managers on these protections can help prevent misunderstandings and reinforce a culture of equity. Clear communication and consistent practices will ensure compliance while supporting a fair workplace environment.

How Pay Transparency Interacts with Pay Equity

Pay transparency and pay equity work together to address wage disparities and create fair compensation practices. Each plays a distinct role in ensuring employees are paid fairly while holding employers accountable for their pay decisions.

Pay equity, guided in Pennsylvania by the Equal Pay Law, focuses on eliminating wage discrimination. This law requires employers to compensate employees equally for jobs that require substantially similar skills, effort, and responsibility under similar working conditions, regardless of gender. Employers must evaluate pay based on objective criteria, not subjective factors or assumptions.

Pay transparency complements pay equity by making compensation practices visible. When employers disclose salary ranges in job postings or during promotions, employees gain a clear understanding of what they can expect to earn. This openness helps uncover discrepancies, pushes employers to review internal pay structures, and reduces the risk of unintentional pay gaps.

Why Pay Transparency and Pay Equity Matter Together

Combining pay transparency with equity initiatives creates a more accountable and fair workplace. Transparency ensures employees have access to information about pay ranges, empowering them to make informed decisions. It also encourages employers to align their compensation practices with established pay equity standards.

Without transparency, inequities can persist unnoticed. Employees may feel undervalued, and employers risk perpetuating pay gaps. By openly sharing salary ranges, businesses take proactive steps to demonstrate fairness and build trust with their workforce.

Penalties for Pay Discrimination

Violating Pennsylvania's Equal Pay Law can lead to serious legal and financial consequences for employers, including:

• Back pay: Employees subjected to wage discrimination can recover unpaid wages.

• Liquidated damages: Employers may owe damages equal to unpaid wages if violations are determined to be intentional.

• Fines: Repeat offenses or egregious violations may result in civil penalties.

Beyond legal repercussions, pay discrimination damages trust, morale, and an organization's reputation. Employers who prioritize transparency and equity reduce these risks while fostering a culture of fairness and accountability.

Existing Pennsylvania Pay Equity Protections

The Equal Pay Law (Pa. Stat. Ann. Title 43) forms the foundation of Pennsylvania's pay equity protections. It ensures employees performing jobs that require substantially similar skill, effort, and responsibility under comparable working conditions are paid equally, regardless of sex. Employers can only justify pay differences using specific, objective factors like seniority, merit, or production-based systems. Any pay disparity must have a clear, nondiscriminatory justification tied to measurable criteria.

Philadelphia's Local Wage Equity Ordinance

Philadelphia’s Wage Equity Ordinance strengthens pay equity protections by targeting salary history inquiries during hiring. Employers in the city cannot ask applicants about prior wages or use past salary information to set compensation. Even if a candidate volunteers salary history, the ordinance prohibits using that information when determining pay.

This requirement applies to all employers operating in Philadelphia, regardless of their size or industry. Noncompliance can result in complaints filed with the Philadelphia Commission on Human Relations, leading to fines or further legal action.

Salary History Restrictions Across Pennsylvania

Although Pennsylvania does not enforce a statewide salary history ban, some jurisdictions may implement similar rules. Employers hiring across multiple locations should review local requirements carefully to confirm compliance with additional prohibitions on salary history inquiries. Remaining consistent across regions helps avoid errors or potential violations.

Employer Actions to Maintain Compliance

Employers covered under Pennsylvania's Equal Pay Law or local ordinances like Philadelphia's must follow specific practices to stay compliant:

• Avoid salary history questions entirely: Remove salary history fields from job applications and refrain from discussing past compensation during interviews.

• Document pay practices thoroughly: Keep detailed records of pay decisions, clearly tying compensation to factors like education, experience, or objective performance metrics.

• Conduct pay audits regularly: Review payroll data to identify and address any unjustified wage disparities. Focus on roles with similar requirements and responsibilities.

These measures not only reduce compliance risks but also demonstrate a commitment to equitable pay practices. Employers who prioritize transparency and accountability in compensation build trust with their workforce and mitigate potential legal exposure.

Penalties, Enforcement, and Practical Risks

Noncompliance with Pennsylvania pay transparency and pay equity laws can lead to significant financial and reputational consequences for employers. Strict adherence to these regulations is necessary to avoid fines, lawsuits, and operational disruptions. Understanding enforcement mechanisms and documenting compliance efforts can protect your organization from unnecessary risks.

Financial Consequences

Noncompliance comes with tangible costs. Employers may be required to pay:

• Government-Imposed Fines: Penalties are often issued for failing to disclose salary ranges, violating pay equity requirements, or conducting salary history inquiries where prohibited.

• Back Wages: Workers affected by unequal pay practices can claim unpaid wages. Employers may also owe double damages if the violation is deemed intentional.

• Settlement Costs: Disputes related to pay can result in costly legal settlements, even if the case doesn't go to court.

For employers managing multiple locations, staying updated on both state and local ordinances is especially important to avoid overlapping fines.

Reputational Damage

Violating pay transparency or equity laws doesn't just lead to financial penalties. It can also harm an employer's reputation. News of noncompliance often spreads quickly, discouraging qualified candidates from applying and reducing trust among current employees.

Public knowledge of unfair pay practices may even impact customer loyalty. A damaged reputation can take years to rebuild, and it often results in higher turnover and lower employee morale. Transparency and compliance aren't just legal obligations—they're also key to maintaining credibility as an employer.

Documentation as a Safeguard

Accurate and thorough documentation protects employers from legal challenges. It also demonstrates a proactive commitment to compliance. Focus on:

• Clear Salary Records: Maintain detailed records of salary ranges and pay-related decisions. Include explanations for differences in pay based on objective criteria, such as education or experience.

• Job Posting Archives: Keep copies of all job advertisements with clearly stated salary ranges. These records provide valuable evidence of compliance during audits or disputes.

• Consistent Pay Audits: Regularly review pay structures for inconsistencies. Address wage gaps promptly and document every adjustment made to correct disparities.

• Written Policies: Create straightforward pay equity and transparency policies. Train managers and HR teams to apply these policies consistently across the organization.

Organized recordkeeping isn't just about avoiding fines. It's about ensuring fairness, building trust, and demonstrating accountability to both employees and external stakeholders.

Multistate Employers with a Pennsylvania Workforce

When managing a workforce across multiple states, pay transparency and equity laws can quickly become a compliance challenge. Pennsylvania's growing momentum toward transparency adds another layer to consider. Employers need straightforward, practical steps to stay compliant while keeping processes manageable.

Follow the Most Stringent Requirements

If you operate in multiple states, adopt the strictest pay transparency rules across your organization. For instance:

• Disclose salary ranges in all job postings: Even if Pennsylvania doesn't require it yet, states like New York and California do. Applying this standard everywhere avoids inconsistency and confusion.

• Provide written pay ranges for promotions: Standardize this practice across locations to ensure fairness and avoid compliance gaps.

• Support anti-retaliation protections: Implement clear policies that apply to all employees, regardless of location, to foster trust and reduce risk.

Uniformity in these practices simplifies compliance and demonstrates a commitment to equitable pay policies.

Create a Single, Comprehensive Pay Policy

Develop one pay transparency policy that applies to every state where you operate. Include:

• How salary ranges are calculated: Outline the methodology, such as market data or internal benchmarks.

• When pay information is shared: Specify timelines for job postings, promotions, and employee requests.

• Employee protections: Reinforce anti-retaliation measures and encourage open discussions about pay.

Training HR teams and managers to implement the policy consistently is essential. A unified approach builds clarity for employees and minimizes administrative headaches.

Centralize Oversight for Compliance

Assign a compliance lead or team to monitor legal changes in pay transparency and equity laws. This group should:

• Track updates to state and local regulations.

• Update policies and practices promptly.

• Ensure all locations align with the most current standards.

Centralized oversight prevents compliance oversights and keeps your organization prepared for audits or inquiries.

Use Systems to Automate and Streamline

HR software can simplify the administration of pay transparency practices. Use systems that:

• Automatically include salary ranges in job postings.

• Maintain accurate, up-to-date pay records.

• Generate reports to audit compliance across locations.

Automation minimizes errors, reduces manual work, and ensures consistency in how salary information is managed.

Prioritize Clear Employee Communication

Employees in different states may have varying levels of awareness about pay transparency policies. Communicate proactively to keep everyone informed. Share updates and expectations through:

• Written policies in employee handbooks.

• Regular training sessions for managers and staff.

• Open channels like Q&A sessions or intranet updates.

Clear communication builds trust and ensures employees understand how pay decisions are made, no matter where they work.Pay transparency and pay equity laws are reshaping how employers approach compensation. Pennsylvania, like many states, is moving toward greater accountability in wage practices. Understanding these laws is key for employers to maintain compliance and foster an equitable workplace.

Below is a straightforward breakdown of common questions about Pennsylvania's pay transparency and pay equity regulations, designed to help employers navigate their obligations with clarity and confidence.

Is there a salary transparency law in Pennsylvania?

Yes, there are existing local regulations and ongoing legislative efforts. For example, Philadelphia enforces the Wage Equity Ordinance, which bans employers from asking about salary history or using past pay to determine current wages. While there isn't yet a statewide salary transparency law, proposals like HB 560 could soon require employers to disclose salary ranges in job postings and promotions. Employers should keep a close watch on state developments to ensure they're prepared for any new mandates.

What is the pay equity law in PA?

The Equal Pay Law prohibits sex-based wage discrimination for jobs requiring substantially similar skills, effort, and responsibility under similar conditions. Employers must justify pay differences with specific, objective factors like seniority, merit, or production output. Local ordinances, such as Philadelphia's Wage Equity Ordinance, further strengthen pay equity by eliminating practices that perpetuate wage gaps. Employers should regularly audit pay practices to ensure they align with both state and local requirements.

What is the PA Wage Collection and Payment Law?

The Pennsylvania Wage Payment and Collection Law (WPCL) outlines employer responsibilities for timely wage payments. This law requires wages to be paid on regularly scheduled paydays and mandates clear, itemized wage statements for employees. If wages are withheld, employees may file claims under the WPCL, potentially leading to penalties like back pay, liquidated damages, or attorney fees. Employers must adhere to written employment agreements and settle disputes promptly to avoid legal repercussions.

Can an employer legally reduce your pay in Pennsylvania?

Employers can adjust pay in specific circumstances. For at-will employees, pay reductions are legal if they're non-discriminatory and comply with minimum wage laws. Changes to pay must be communicated in advance and cannot be applied retroactively. Employers must also ensure any reduction doesn't violate written agreements or retaliation protections. Clear documentation and transparent communication are necessary to avoid misunderstandings and maintain compliance.

Implementing Compliance Best Practices

Building compliance into your pay processes starts with actionable steps that align with Pennsylvania's pay transparency and pay equity laws. Employers need clear, repeatable methods to ensure both legal adherence and fairness in compensation practices. Here's how to approach it effectively.

Conduct a Thorough Internal Audit of Pay Practices

Reviewing pay structures is the foundation for compliance. Start by analyzing salary data across all roles in your organization. Identify inconsistencies and ensure pay decisions align with objective factors like experience, education, and performance metrics.

• Compare salaries: Evaluate pay for employees in similar roles to ensure there are no unexplained disparities.

• Document pay decisions: Clearly outline how compensation for each role is determined, using measurable criteria.

• Schedule regular reviews: Perform audits at least once a year to address any emerging gaps or changes in the law.

An organized audit process not only highlights potential issues but also helps employers prepare for any external reviews or inquiries.

Use HR Systems to Simplify Recordkeeping and Compliance

An HR system can centralize compensation data and automate processes for better accuracy and efficiency. Employers managing payroll manually risk errors that could lead to compliance violations.

• Centralize salary information: Store all pay ranges, job descriptions, and compensation adjustments in one secure system.

• Set automated reminders: Use notifications to track legislative updates and ensure compliance deadlines are met.

• Generate detailed reports: Create reports that demonstrate compliance, especially during audits or employee inquiries.

Automation reduces administrative strain while making it easier to track and verify adherence to pay transparency laws.

Train Recruiters and Managers to Handle Pay Discussions

Recruiters and managers are often on the frontlines of pay transparency. Equip them with clear guidelines for discussing compensation to avoid confusion or noncompliance.

• Explain salary ranges accurately: Teach staff how to present pay ranges in job postings and during interviews without overpromising or understating.

• Reinforce salary history bans: Ensure no one asks candidates about previous pay, even casually.

• Address pay-related questions: Train managers to provide clear, consistent answers when employees request information about their compensation.

Provide written guides and hold regular training sessions to reinforce best practices. Employees and candidates should leave pay discussions with a clear understanding of their compensation.

Each of these steps ensures that compliance is not only met but integrated into your organization's day-to-day operations.

Steps to Prepare for 2025

To comply with Pennsylvania pay transparency and pay equity laws, preparation begins with clear action steps. Employers can strengthen their processes by refining documentation, applying consistent practices, and staying informed about legal updates. Here's what to focus on for 2025.

Finalize Standard Job Descriptions and Pay Ranges

Job descriptions and pay ranges must be detailed and aligned with industry standards. Avoid vague or overly broad descriptions—they create confusion and compliance risks.

• Create precise job descriptions: Break down responsibilities, required skills, and qualifications for each role. Include measurable criteria wherever possible.

• Define pay ranges clearly: Use salary data from reliable sources to establish specific ranges. Ensure ranges reflect the skills and experience required for the position.

• Document pay decisions: Maintain records explaining how ranges were determined. This includes referencing benchmarks, market data, or internal compensation structures.

Review and update descriptions annually or whenever roles change. Ensure every role reflects current expectations and compensation standards.

Implement Consistent Guidelines for Internal Postings and Promotions

Internal transparency is as important as what's shared externally. Employees expect fairness during promotions and lateral moves. Consistency builds trust and reduces turnover.

• Standardize internal job postings: Include the same level of detail as external listings. Employees should see pay ranges and clear criteria for all opportunities.

• Provide written salary details for promotions: When promoting employees, share the pay range for the new role in writing. This ensures transparency and avoids miscommunication.

• Train managers thoroughly: Equip managers with clear instructions for communicating pay details. Provide templates or scripts to maintain consistency during discussions.

Consistency across internal and external processes ensures fairness and compliance. Employees notice when employers take transparency seriously.

Monitor Amendments to HB 560 and Local Ordinances

Pay transparency laws can evolve quickly. Employers must stay ahead by monitoring changes at both state and local levels.

• Track updates to HB 560: Keep an eye on legislative sessions for amendments or new requirements. Assign a dedicated team member or subscribe to compliance updates for alerts.

• Review changes to local ordinances: Cities often adopt stricter measures than the state. For example, Philadelphia has its own wage equity rules. Regularly review local regulations for updates.

• Leverage compliance networks: Membership in HR organizations can provide early notice of legal changes and offer resources for adapting policies.

Monitoring changes ensures your policies remain compliant and up to date. Regularly revisiting pay practices and communication guidelines minimizes risks and keeps your workforce informed.

Pay transparency and pay equity are no longer optional for Pennsylvania employers—they're essential for compliance and building trust with your workforce. As you navigate these evolving regulations, remember that clear documentation, consistent practices, and ongoing monitoring are key to staying ahead of the curve. If you're looking for a partner to simplify your HR processes and ensure compliance, book a demo with GoCo today and discover how our platform can support your pay equity and transparency efforts.