Pay transparency continues to be a major focus of employment law in 2026, with expanded requirements that directly impact how employers recruit, compensate, and manage risk. As part of our January HR compliance series, Continental Business Solutions’ HR Services is highlighting key elements of the Pay Transparency Law that employers should understand and address now.
Pay Scale Disclosure Requirements
Employers with 15 or more employees are required to include a good-faith estimate of the expected salary or hourly wage in all job postings. This requirement applies regardless of whether the posting is internal or external.
The disclosed pay scale must:
- Reflect the actual compensation the employer intends to pay for the position
- Be based on current compensation practices and budgeted ranges
- Align with how similar roles are paid within the organization
Posting inaccurate or overly broad pay ranges can create compliance risk and undermine employee trust.
Expanded Definition of “Wages”
The law significantly broadens the definition of wages. Employers must now consider total compensation, not just base pay, when evaluating pay equity and transparency obligations.
Wages may include:
- Base salary or hourly pay
- Bonuses and incentive compensation
- Equity awards and stock options
- Other forms of non-cash compensation
This expanded definition requires employers to take a more holistic approach when reviewing compensation structures and responding to pay-related inquiries.
Increased Statute of Limitations and Employer Risk
The updated law extends the timeframe for employees to bring pay discrimination claims:
- Employees now have three years to file a claim (previously two years)
- If a violation is proven, employees may seek up to six years of back pay
These changes significantly increase potential financial exposure for employers and reinforce the importance of accurate documentation, consistent pay practices, and proactive compliance reviews.
What Employers Should Do Now
To prepare for and comply with pay transparency requirements, employers should:
- Review and update job postings to include compliant pay ranges
- Conduct compensation and pay equity audits
- Ensure wage definitions are applied consistently across roles
- Train HR and hiring managers on disclosure and documentation requirements
How Continental Business Solutions Can Help
Continental Business Solutions’ HR Services helps employers navigate complex pay transparency laws with confidence. From compensation reviews and policy updates to job posting compliance and manager training, our team provides practical guidance tailored to your workforce.
January is the ideal time to assess your pay practices and reduce risk. Proactive compliance today can help protect your organization and strengthen employee trust in 2026 and beyond.
Continental Business Solutions – Business Solutions for Today’s Workforce.
