Illinois' new salary transparency law is all about closing gender, racial wage gaps

Like much of the emerging labor force, my millennial mindset challenges many age-old taboos. I proudly embrace that “dirty word”— feminist. I don’t necessarily aspire to be humble. And yes, I talk openly about compensation with my close friends and coworkers.

These conversations have opened my eyes to just how commonplace gender wage discrepancies still are — even in male-dominated fields where women, like the trailblazer who raised me, are pushing boundaries.

This reality extends far beyond my inner circles. For women in Illinois, the gap is, on average, 84 cents for every dollar men earn and is even more pronounced for women of color. Simply breaking taboos won’t solve this problem, but upcoming legislation could — if employees and employers alike seize the opportunity.

Beginning Jan. 1, Illinois will require businesses with 15 or more employees to include salary range and benefits in job postings. Gov. JB Pritzker signed this amendment to the Illinois Equal Pay Act in 2023, 20 years after the law’s original passage, aiming to eliminate gender wage discrimination.

The law should enable job seekers to gain more wage information, expose pay inequities and address the persistent gender and racial wage gaps.

Until last year, the Illinois gender wage gap was consistently wider than the U.S. average — which has barely budged in the past two decades. The state’s new law aligns with a growing national trend toward pay transparency, joining states like Colorado and California, which have shown that salary disclosures can help narrow wage gaps.

A Chicago Mayor’s Women’s Advisory Council Report found COVID-19 exacerbated gender wage disparities, revealing structural inequities in the labor market. Stay-at-home orders, caregiving demands and job losses hit women, particularly Black women, the hardest.

From 2019 to 2020, approximately 36,000 fewer women in Chicago were in the workforce, compared to just 11,000 fewer men. As Illinois recovers, transparency offers a crucial opportunity to rebalance economic security.

Salary transparency-regulated states provide encouraging evidence. In Colorado, where similar legislation was introduced in 2021, transparency requirements prompted employers to assess and correct internal pay practices. This progress reduced Colorado’s gender wage gap more than three times faster than the national average.

Transparent pay practices don’t just boost trust and morale — they reduce employee turnover by 30% and disrupt negotiating dynamics that have long worked against women.

For employers, transparency represents an opportunity to promote pay equity while attracting top talent and gaining a competitive advantage in today’s job market.

Critics argue that salary transparency laws could backfire, suggesting employers might post exaggeratedly wide salary ranges. However, the Illinois Equal Pay Act protects against abuse by requiring employers to reference actual ranges for equivalent positions. Workers can also file complaints with the Illinois Department of Labor.

Of course, salary transparency alone isn’t a cure-all. Achieving gender pay equity demands systemic change, including shifts in workplace culture, dismantling implicit biases and overcoming persistent challenges that “traditional” social hierarchies pose to women’s socioeconomic advancement. A woman’s place can be in the boardroom!

For a generation unafraid to challenge taboos, Illinois’ transparency law offers a tangible way to back conversations with action. If you’re an Illinois worker, remember, starting Jan. 1, all new job postings must include salary and benefits information. Workers should receive this before disclosing wage expectations, and prospective employers cannot ask about salary history.

Companies should proactively review compensation structures to align with industry standards and be prepared to disclose ranges or face hefty fees. Awareness of these rights empowers women to negotiate confidently and demand fair pay.

By embracing salary transparency, Illinois can level the playing field and reduce the state’s gender wage gap. While this legislation won’t close the gap overnight, it’s a meaningful step in the right direction. Transparency arms workers with information, and it’s time to take advantage of that power.

Becca Herman is a Chicago native, a business operations manager and a master of public administration candidate at NYU Wagner.

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