Tag: Washington

Washington State’s Pay Transparency Law Takes Effect January 1, 2023

Effective January 1, 2023, Washington employers must comply with SB 5761, commonly known as Washington’s Pay Transparency Law, signed by Governor Jay Inslee on March 30, 2022. SB 5761 amends Washington’s Equal Pay and Opportunity Act (RCW 49.58) to require employers with 15 or more employees to include in each job posting the wage scale or salary range of the job and a general description of all of the benefits offered and to identify other compensation offered. The law also requires employers to provide existing employees who are promoted or offered a new position with the wage scale or salary range of the new position.

IN DEPTH

Washington’s Equal Pay and Opportunity Act currently only requires employers to provide applicants with the minimum wage or salary for the position they seek and only upon the applicant’s request after the employer makes the job offer.

WHAT IS THE PAY TRANSPARENCY LAW?

Effective January 1, 2023, employers must disclose in each posting for each job opening the wage scale or salary range and a general description of all benefits and other compensation to offered to the hired applicant.

Job postings mean “any solicitation included to recruit job applicants for a specific available position,” and electronic or hard-copy records that describe the desired qualifications, whether the employer solicits applicants directly or indirectly through a third party.

Washington’s Department of Labor and Industries (DLI) has published a draft administrative policy that provides employers with guidance on compliance.

WHICH EMPLOYERS ARE COVERED?

The law applies to employers with 15 or more employees.

DLI’s guidance clarifies that the law applies to all employers with 15 or more employees, engaging in any business, industry, profession or activity in Washington. The 15-employee threshold for covered employers “includes employers that do not have a physical presence in Washington, if the employer has one or more Washington-based employees.” This law applies to employers even if they do not have a physical presence in Washington but engage in business in Washington or recruit for jobs that could be filled by a Washington-based employee.

WHAT MUST EMPLOYERS INCLUDE IN THE POSTING?

Employers must disclose in each posting for each job opening:

  • The opening wage scale or salary range
  • A general description of all benefits and other compensation offered.

Per the DLI’s guidance, employers must make these disclosures in postings for remote work that could be performed by a Washington-based employee. Employers cannot avoid these disclosure requirements by stating in the posting that it will not accept Washington applicants.

Wage Scale or Salary Range

The DLI’s guidance identifies examples of information that should be included in a posting.

A wage scale or salary range should provide the applicant with the employer’s most reasonable and genuinely expected range of compensation for the job, extending from the lowest to the highest pay established by the employer prior to publishing the job posting. If the employer does not have an existing wage scale or salary range for a position, the scale or range should be created prior to publishing the job posting. For example, the scale or range’s minimum and maximum should be clear without open-ended phrases such as “$60,000/per year and up” (with no top of the range), or “up to $29.00/hour” (with no bottom of the scale).

Employers should update the posting to reflect any changes to the wage scale or salary range. If the employer offers a different position than what the applicant applied for, the employer may offer the applicant the wage scale or salary range specific to the position offered, rather than the position in the posting.

If an employer intends to implement a “starting range” or “starting rate” for an initial timeframe of employment or probationary period, the starting range or rate may be listed on the posting, but the entire scale or range must also be listed on the posting.

If an employer publishes a job posting for a job opening that can be filled with varying job titles, depending on experience, the employer should specify all potential wage scales or salary ranges that apply. The job posting should clearly define the lowest to highest pay established for each potential job position, as indicated in the example below:

  • Accounting Analyst 1: $27.00 – $29.00 per hour
  • Accounting Analyst 2: $65,000 – $75,000 per year
  • Accounting Analyst 3: $80,000 – $95,000 per year.

If an employer posts a job that is compensated by commission rates, the employer should include the rate or rate range (percentage or otherwise) that it would offer to the hired applicant, as indicated in the example below:

  • Commission-based salesperson: 5–8% of net sale price per unit.

General Description of All Benefits 

A general description of all benefits includes, but is not limited to, healthcare benefits, retirement benefits, any benefits permitting paid days off (including more-generous paid sick leave accruals, parental leave, and paid time off or vacation benefits), and any other benefits that must be reported for federal tax purposes, such as fringe benefits.

If the general description of all benefits changes after an employer has published a posting and the posting remains published, the employer should update the posting.

If insurance or retirement plans are included as part of the position’s benefits package, employers should list the types of insurance and retirement plans in the job posting, such as medical insurance, vision insurance, 401k and employer-funded retirement plan. Similarly, if an employer offers paid vacation, paid holidays or paid sick leave benefits, employers should list in detail the amount of days or hours offered for each benefit.

The DLI’s example of a general description of all benefits is as follows:

  • “Employees (and their families) are covered by medical, dental, vision, and basic life insurance. Employees are able to enroll in our company’s 401k plan, as well as a deferred compensation plan. Employees will also receive eight hours of vacation leave every month, as well as eight hours of Washington paid sick leave every month. Employees will also enjoy twelve paid holidays throughout the calendar year. Two weeks of paid parental leave will also be available for use after successful completion of one year of employment.”

General Description of Other Compensation 

Other compensation includes, but is not limited to, any discretionary bonuses, stock options or other forms of compensation that would be offered to the hired applicant in addition to their established salary range or wage scale. Some forms of other compensation can include, but are not limited to, commissions, bonuses, profit-sharing, merit pay, stock options, travel allowance, relocation assistance and housing allowance.

Employers need only describe the other compensation and need not include the total monetary value of the other compensation in a job posting. However, employers who choose to include the total monetary value of other compensation in a job posting must also include the required general description of benefits and other compensation in addition to the wage scale or salary range.

The DLI’s example of a general description of other compensation is as follows:

  • “Hired applicant will be able to purchase company stock, receive annual bonuses, and can participate in profit-sharing. Hired applicant will also receive an equity grant in the form of either a direct grant of stock that will be specified in the employment contract or an option to purchase stock in the future for a specified price.”

In electronic job postings, the posting must have the general description of the benefits and other compensation, but employers can use a link to provide a more detailed description of benefits and other compensation. However, “it is the employer’s responsibility to assure continuous compliance with functionality of links, up-to-date information, and information that applies to the specific job posting, regardless of any use of third-party administrators.”

WHAT ARE THE CONSEQUENCES OF NONCOMPLIANCE?

Where an employer is out of compliance with this law, applicants and employees will be able to file a complaint with the DLI or file a civil lawsuit against the employer in court.

If applicants or employees file a complaint with the DLI, the DLI may issue a citation and/or notice of assessment and order the employer to pay to the complainant actual damages, double statutory damages (or $5,000, whichever is greater), interest of 1% per month on compensation owed, payment to the department for the costs of investigation and enforcement, and other appropriate relief. The DLI may also order an employer to pay civil penalties in response to complaints, ranging from $500 for a first violation to $1,000 or 10% of damages (whichever is greater) for a repeat violation.

If applicants or employees file a civil lawsuit, remedies may include actual damages, double statutory damages (or $5,000, whichever is greater), interest of 1% per month on compensation owed, and reimbursement of attorneys’ fees and costs. Recovery of wages and interest will be calculated back four years from the last violation.

Note: This alert was drafted based on Washington State’s Department of Labor & Industries’ Draft Administrative Policy, which may be superseded by a revised final version before January 1, 2023. 

Article By Yesenia M. Gallegos, Michelle S. Strowhiro, and Paulina Chau of McDermott Will & Emery

For more labor and employment legal news, click here to visit the National Law Review.

© 2022 McDermott Will & Emery

New Washington State Privacy Bill Incorporates Some GDPR Concepts

A new bill, titled the “Washington Privacy Act,” was introduced in the Washington State Senate on January 18, 2019. If enacted, Washington would follow California to become the second state to adopt a comprehensive privacy law.

Similar to the California Consumer Privacy Act (CCPA), the Washington bill applies to entities that conduct business in the state or produce products or services that are intentionally targeted to residents of Washington and includes similar, though not identical size triggers. For example, it would apply to businesses that 1) control or process data of 100,000 or more consumers; or 2) derive 50 percent or more of gross revenue from the sale of personal information, and process or control personal information of 25,000 or more consumers. The bill would not apply to certain data sets regulated by some federal laws, or employment records and would not apply to state or local governments.

The bill incorporates aspects of the EU’s General Data Protection Regulation (GDPR) and borrows the “controller”/“processor” lexicon in identifying obligations for each role from the GDPR. It defines personal data as any information relating to an identified or identifiable natural person, but does not include de-identified data. Similar to the GDPR, it treats certain types of sensitive information differently. Unlike the CCPA, the bill excludes from the definition of “consumer” employees and contractors acting in the scope of their employment. Additionally, the definition of “sale” is narrower and limited to the exchange of personal data to a third party, “for purposes of licensing or selling personal data at the third party’s discretion to additional third parties,” while excluding any exchange that is “consistent with a consumer’s reasonable expectations considering the context in which the consumer provided the personal data to the controller.”

Another element similar to the GDPR in the bill, requires businesses to conduct and document comprehensive risk assessments when their data processing procedures materially change and on an annual basis. In addition, it would impose notice requirements when engaging in profiling and a prohibition against decision-making solely based on profiling.

Consumer rights 

Similar to both the GDPR and the CCPA, the bill outlines specific consumer rights.  Specifically, upon request from the consumer, a controller must:

  • Confirm if a consumer’s personal data is being processed and provide access to such data.
  • Correct inaccurate consumer data.
  • Delete the consumer’s personal data if certain grounds apply, such as in cases where the data is no longer necessary for the purpose for which it was collected.
  • Restrict the processing of such information if certain grounds apply, including the right to object to the processing of personal data related to direct marketing. If the consumer objects to processing for any purpose other than direct marketing, the controller may continue processing the personal data if the controller can demonstrate a compelling legitimate ground to process such data.

If a controller sells personal data to data brokers or processes personal data for direct marketing purposes, it must disclose such processing as well as how a consumer may exercise the right to object to such processing.

The bill specifically addresses the use of facial recognition technologies. It requires controllers that use facial recognition for profiling purposes to employ meaningful human review prior to making final decisions and obtain consumer consent prior to deploying facial recognition services. State and local government agencies are prohibited from using facial recognition technology to engage in ongoing surveillance of specified individuals in public spaces, absent a court order or in the case of an emergency.

The Washington State Attorney General would enforce the act and would have the authority to obtain not more than $2,500 for each violation or $7,500 for each intentional violation. There is no private right of action.

The Washington Senate Committee on Environment, Energy & Technology held a public hearing on January 22, 2019 to solicit public opinions on this proposed legislation. At the beginning of the public hearing, the Chief Privacy Officer of Washington, Alex Alben, commented that the proposed legislation would be just in time to address a “point of crisis [when] our economy has shifted into a data-driven economy” in the absence of federal legislation regarding data security and privacy protection.

Industry reaction to the bill

Companies and industry groups with an interest in this process applauded this proposed legislation as good news for entities that have become, or are on their way, to becoming compliant with the GDPR. Many also shared suggestions or criticisms. Among others, some speakers cautioned that by setting a high standard closely resembling the GDPR, the bill might drive small- or medium-sized companies to block Washington customers, just as they have done in the past to avoid compliance with the GDPR.

Some representatives, including the Chief of the Consumer Protection Division of the Washington Attorney General’s Office, call for a private cause of action so that this law would mean more to a private citizen than simply “a click on the banner.” The retail industry, the land title association, and other small business representatives expressed their preference for legislation on a federal level and a higher threshold for applicable businesses. Specifically, Stuart Halsan from the Washington Land Title Association recommended that the Washington Senate consider this bill’s impact on industries, such as the land title insurance industry, where the number of customers is significantly lower than the amount of data it processes in their ordinary course of business.

In response to these industry concerns, the committee acknowledged that this new legislation would need to be very sensitive to apply proportionately to businesses of different sizes and technology capabilities. The committee also recognized the need to make this legislation more administratively feasible for certain industries or entities that face difficulty in compliance (such as the secondary ticketing market) or subject to complicated regulatory frameworks (such as the bank industry). The Washington Senate continues to invite individuals, companies, or industry groups to submit brief written comments here.

 

©2019 Drinker Biddle & Reath LLP. All Rights Reserved

Climate Change Policy Developments in Washington State

climate changeSeveral climate policy initiatives are underway in the Washington State legislature, agencies, and courts.  This alert summarizes these key developments—future alerts will provide greater detail and topical analysis.

1.  Legislative and Ballot Initiatives.

In November of 2016, voters rejected a state carbon tax.  Initiative 732, the Washington Carbon Emission Tax and Sales Tax Reduction, would have established a tax that started at $15/metric ton of carbon dioxide and increased over time.  Following the defeat of I-732, Governor Inslee introduced his 2017-2019 budget, which includes a $25/ton carbon tax that would take effect May 1, 2018.  In addition to the Governor’s budget proposal, the legislature is considering a carbon tax bill and a bill that would substantially tighten the state’s GHG reduction targets.  Depending on the outcomes of this legislative session, environmental groups and climate policy experts may consider a future ballot initiative.

2.  Science Assessments.  

Responses to climate change are informed by science that assists decision-makers on the progression of climate change and its impacts.  The Fourth National Climate Assessment is underway with public meetings in support of the Northwest Region chapter’s drafting.   In addition, based on recent studies on existing climate change and its impacts and costs, the Washington State Department of Ecology (Ecology) recommended a substantial tightening of the state’s GHG reduction targets. This recommendation is noteworthy because the current GHG reduction targets were relied upon to support Ecology’s proposed Clean Air Rule.     

3.  Rule-making and Implementation.

On January 1, 2017, Ecology’s Clean Air Rule (CAR) went into effect. The CAR initially imposes emission limits on “covered parties” that Ecology deems responsible for at least 100,000 metric tons of carbon dioxide annually—including not only owners of stationary sources such as power plants and factories—but also entities that sell, distribute, or import petroleum and natural gas.  Covered parties in these categories must reduce their emissions by 1.7%/year (until 2036) from an organization-specific baseline determined by Ecology.

The CAR provides special treatment to covered parties that are in sectors for which higher energy costs could result in competitive disadvantages.  These “energy-intensive, trade-exposed industries” are not subject to program until 2020, and have emission reduction pathways set by a different methodology.

A covered party can comply with its emission limit by directly reducing its emissions or by purchasing and using credits (termed “ERUs”) available from in-state mitigation projects, renewable energy credits, or allowances from certain out-of-state climate programs.  Ecology is currently developing policies for developers of emission mitigation projects that want to generate ERUs.

4.  Litigation.

a.  Rule challenges:  The new CAR was challenged through suits filed in state and federal court. The state court cases (Ass’n of Wash. Bus. v. Dep’t of Ecology and Avista Corp. v. Dep’t of Ecology) have been consolidated in Thurston County Superior Court, and the federal case (Avista Corp. v. Dep’t of Ecology) is stayed pending final adjudication of the state court matter. The state case includes allegations that the CAR exceeds Ecology’s authority under the Washington Clean Air Act because it regulates natural gas and petroleum distributors that are not “sources” of emissions in the meaning of the statute.

b.  Citizen Suits and Children’s Lawsuit:  A group of eight Washington children brought suit against Ecology for the agency’s failure to regulate carbon dioxide emissions and for failing to protect the children from climate change impacts.  In 2015, the trial court held that climate change affects public trust resources in the state, but that the state was fulfilling its public trust obligations by engaging in the rulemaking. This rulemaking ultimately resulted in adoption of the CAR and the case is now on appeal regarding whether Ecology’s finalization of the CAR resolves all claims. However, the parties continue to make arguments to the trial court regarding whether the children should be permitted to amend their complaint so that they “can show evidence and argue that their government has failed and continues to fail to protect them from global warming.” (Foster v. Dep’t of Ecology, No. 14-2-25295-1 SEA and COA 75374-6-I.)

5.  State Hearings Boards and Local Hearing Examiners.

State and local agencies are exploring their authority to control GHG emissions and impose mitigation for climate impacts.  For example, the Washington Growth Management Act and the Shoreline Management Act contain provisions requiring agencies to consider the public interest and protection of the environment when implementing these statutes.

In furtherance of this general mandate, agencies and local governments might conduct their own analyses of GHG emissions and climate impacts, or require permit applicants to do so to satisfy these generalized permit criteria, and might claim authority to impose mitigation outside the specific scope of the state agency rules described above.

Appeals challenging agency decisions under those statutes are heard by the Growth Management Hearings Board, Shoreline Hearings Board, and Pollution Control Hearings Board, all housed in the state’s Environmental Hearings Office.  These boards are becoming a forum for arguments regarding authority to impose GHG limitations or mitigation, and the adequacy of the underlying analysis under the State Environmental Policy Act.

In addition, local government codes sometimes contain provisions requiring consideration of GHG emissions and provide guidelines for calculations of emissions and impacts. Local land use decisions applying those provisions are subject to review before local hearing examiners, potentially subjecting matters in those venues to similar climate change and GHG arguments and challenges.  This body of local decisions and appellate review is just beginning to take shape and has the potential to establish precedent for climate impact review and mitigation throughout the state.

6.  SEPA Guidance.

The State Environmental Policy Act (SEPA) directs local and state agencies to identify and evaluate the environmental impacts of their actions. Unless an action is “categorically exempt,” SEPA review is triggered when a proposal requires a governmental agency to make a decision or fund an action that may significantly affect the quality of the environment.

In 2011, Ecology, as the lead agency, issued agency guidance on consideration of climate change under SEPA. Other SEPA lead agencies have followed Ecology’s guidance.  In late 2016, Ecology removed the guidance from its website and indicated it (1) had begun planning its first periodic update of the guidance, and (2) is gathering information about new methods that local, state, and federal agencies are using to evaluate GHG emissions and climate change impacts.

In the meantime, agencies have been requiring such information from project proponents.  SEPA determinations and related documents have been subject to challenge and appeal.  There is growing Washington case law on the treatment of GHG emissions and the impact of climate change.

7.  Adaptation and Increasing Resilience to Climate Change Impacts.

Recognizing Washington’s vulnerability to climate impacts, the state published the Washington State Integrated Climate Change Response Strategy  to help prepare for climate change impacts and protect Washington’s communities, natural resources, and economy from the impacts of climate change.   Throughout Washington, city and county officials, Tribal leaders, and other stakeholders are planning for more climate-resilient communities.  For example, the City of Olympia is “developing a Sea Level Response Plan that will balance risks, uncertainty, and both private and public costs.”

ARTICLE BY Terese (T.C.) Richmond, Kyle W. Danish, Duncan M. Greene & Jay P. Derr of Van Ness Feldman LLP
© 2017 Van Ness Feldman LLP