By: Reeves Singleton, Volume 43 Staff Member

View/Download PDF Version: That Pays How Much? A Brief Look at Minnesota’s New Wage Transparency Law (Singleton)

Almost anyone who has applied to a job in the last ten years can regale you with stories of frustration, exhaustion, and an ever-deepening distaste for the very concept of job seeking. The issues at play for the hopeful job seeker are numerous, and they provide a wide range of anecdotal horror stories: dubious or fake listings, horrendous job boards, application processes requiring individual account creation, the common experience of never even hearing a “no” from an employer if one’s application is not tweaked to fit the contours of algorithmic decision-making. These experiences and others go toward the common knowledge that finding a job on the contemporary market is more often than not an intensive and futile misadventure. This is the bleak environment into which job seekers enter, even though they are already likely overburdened by whatever situation has necessitated their finding a new job in the first place.

Alongside the number of other laws that went into effect in Minnesota on January 1, 2025, many of which seek to strengthen protections for employees, the state of Minnesota has now implemented a new law that aims to address one issue that has long plagued the hopeful job applicant. Joining similar statues in a range of other states, Minn. Stat. § 181.173 compels employers to disclose in job postings “the starting salary range, and a general description of all of the benefits and other compensation” or otherwise “list a fixed pay rate” for those situations wherein the employer does not provide a salary range. The law designates employers covered by this law as “a person or entity that employs 30 or more employees at one or more sites in Minnesota,” while defining “postings” to include “any solicitation intended to recruit job applicants for a specific available position . . .  that includes qualifications for desired applicants” and “salary range” as being “the minimum and maximum annual salary or hourly range of compensation . . . for a job opportunity of the employer at the time of the posting of an advertisement for such opportunity.” Taken as a whole, this and other similar provisions suggest the possibility of an at least somewhat more equitable playing field for hiring within the state, with wage transparency providing opportunity for workers both established and prospective to evaluate how an employer judges the worth of their labor.

There are obvious ways that a law demanding wage transparency might go towards ensuring a more equitable, navigable job market for employees. On the most immediate level, the inclusion of salaries/wages on job listings allows a prospective employee to more confidently gauge the value of a position relative to the listed requirements and expectations of a given role. For job hunters crushed on the one hand by a likely severe and growing need for financial security and on the other by the temporally, emotionally, and psychologically draining realities of the modern job hunting process, this mote of certainty and predictability offers at least some light on which to seize in the dark of the job market, albeit one predicated on the good faith of the employer. More importantly, however, is the renewed possibility of situational awareness and accountability that the ideal functioning of the wage transparency law forwards.

The major benefit of wage transparency laws is the ability for workers both new and established to gauge the equitability of their earnings when compared to recruitment happening for the same or similar roles, which is especially important in the context of wage gaps. This might, for instance, be a useful tool when trying to gauge whether a particular role or company is likely to provide for inequitable pay based on sex, gender identity, race, or other identity. Additionally, the demand that covered companies publicize the potential salary/wage of posted roles conceivably makes it at least somewhat more difficult for employers to continue upholding this brand of wage discrepancy. Without wage transparency, it is far easier for employers to obscure inequities in the wages they pay. Deprived of the ability to not say what a given role will pay, employers must make some commitment to paying whatever applicant is offered a role a wage within the same range as they would have offered any other applicant. As a move towards a more equitable, understandable wage and job market, this is undoubtedly a positive if uncertain step, even if there are potential issues that arise alongside such laws. Such issues may even include constitutional questions around issues of compelled speech and the applicability of the Dormant Commerce Clause.

At the same time, Minn. Stat. § 181.173 is frustratingly vague on enforcement provisions or the consequences of an employer’s failure to comply with the statute, or even to what extent the statute might apply to general solicitations of employment. While the Minnesota Department of Labor and Industry (MDLI) is presumably the body tasked with enforcing the provision, the statute itself provides no indication of what, if any, sanction will accompany its violation. Perhaps more worrying, there does not seem to be any language in the statute that might prevent an employer from essentially pulling the rug out from under an applicant offered a job, beyond requiring that the posted salary be based on a “good faith estimate.” If an employer is unrestrained from not honoring the wage range listed in its job posting, then there is little to prevent the employer from undercutting the stated range at the time it actually makes an offer. Certainly, the applicant could simply walk away were that to happen, but to do that is a lot to ask of someone who is presumably in need of a job, perhaps desperately.

So on the one hand, job seekers in Minnesota can expect some additional certainty and transparency while applying for jobs, which is certainly welcome given the often painful process of job hunting. On the other hand, there seems to be little more in place to ensure that companies even adhere to the requirement to list accurate estimates of wages in job postings, much less any actual compulsion to commit to those listings when they make an actual job offer. In general, it is likely that pay transparency laws broadly contribute to a narrowing of wage gaps, but the long term efficacy of these laws is still uncertain. While it is hopeful that MDLI will enforce Minn. Stat. § 181.173 to ensure immediate benefits for employees, more definite statutory provisions supporting wage transparency are necessary to ensure equity, accessibility, and certainty in the Minnesota job market now and into the future.