Here is the claim, stated so it can be disagreed with: salary-range disclosure laws now cover most of the US hiring market, but “good faith range” has no enforced methodology behind it. Most employers are complying with the letter of a transparency law while the number inside the range remains exactly as arbitrary as it was before the law existed. The law changed what candidates see. It did not change how the number was built.
That gap — between visible compliance and invisible arbitrariness — is where the next wave of pay litigation is already being written.
1. The mandate is bigger than most reward teams have registered
As of early 2026, 17 US states plus multiple municipalities require salary ranges in job postings, and an estimated 65% of US employers now operate under some pay-transparency mandate, whether they recognize it or not. The obligation follows the job, not the employer’s address: a remote posting that could be filled by someone in a covered state triggers that state’s disclosure requirement, regardless of where the company is headquartered or whether it has ever had an office there. [1]
The mechanism most compensation teams underestimate is exactly that geographic reach. A company with zero physical presence in Colorado, New York, or Washington can still owe those states’ disclosure obligations the moment a remote req goes live to a national candidate pool. The implication: a company that believes pay-transparency law “doesn’t apply to us” because it has no office in a covered state is very likely already non-compliant, and has been for as long as it has posted remote roles nationally.
2. “Good faith” tests sincerity, not soundness
Nearly every state law uses some version of the same phrase: the range must be what the employer “reasonably and in good faith expects to pay” — language drawn directly from New York’s and Massachusetts’s statutory text, and echoed in California’s amended definition of “pay scale” under SB 642. New York’s Department of Labor defines good faith as the minimum and maximum the employer honestly believes to be accurate at the time of posting, and its 2026 amendments now explicitly prohibit placeholder ranges — a $1-to-$1-million posting no longer satisfies the law. [2][3]
Read the mechanism precisely, because the precision is the whole argument. “Good faith” is a state-of-mind standard: did the employer sincerely believe the number? “Reasonably” layers on an objective test: was that belief rational? But not one of these statutes specifies what makes a belief reasonable — no state mandates a market-pricing survey, a job evaluation grade, or a documented internal-equity check as the required input. Two employers can post wildly different ranges for the identical role, in the identical market, and both can be in good-faith compliance — because the law tests whether each employer sincerely and rationally arrived at its own number, never whether the number itself reflects any external evidentiary standard.
The implication: “good faith” has become a legal floor, not a compensation standard. Clearing the floor requires only that someone, somewhere in the organization, can say with a straight face that the number felt right.
3. Where an objective test exists, it checks width — not derivation
New Jersey is the one state that has gone further, and its rule is instructive precisely because of how narrow it is. Under regulations proposed following the state’s Pay Transparency Act, the spread between the minimum and maximum of a posted range cannot exceed 60% of the minimum — the first and, to date, only prescribed quantitative constraint on a US pay range. A range of $100,000 to $160,000 complies; $100,000 to $200,000 does not. [4]
The mechanism is worth sitting with. New Jersey’s rule regulates the shape of the range — how wide the band is allowed to be — not where within that band the number should sit, and not what evidence justified either endpoint. An employer can satisfy the 60% cap with a range built entirely from a recruiter’s guess, a competitor’s posted number copied without adjustment, or the outgoing incumbent’s salary carried forward regardless of market movement — and the regulation has nothing to say about any of it, as long as the spread math checks out.
The implication is sobering for anyone who assumed increasing regulatory sophistication would eventually require methodological rigor. The most prescriptive rule in the country checks arithmetic, not architecture.
4. Compliance itself is thinner than the headlines suggest
Before asking whether posted ranges are defensible, it’s worth confirming whether ranges are even present. Research from the Federal Reserve Bank of New York’s Liberty Street Economics, using granular Lightcast job-posting data published in October 2025, found that roughly a quarter of job listings covered by pay-transparency laws still fail to include salary information at all. [5]
The mechanism behind that gap is enforcement posture, not statutory ambiguity. Most jurisdictions have policed presence — is a range there or not — far more actively than they have policed derivation. Recent activity in Washington shows what happens once litigation catches up to that gap: one law firm alone has filed 31 lawsuits against major employers under the state’s pay-transparency law since it took effect, with waves of roughly 30 class actions filed within single weeks against companies that had, in many cases, posted no range or an inadequate one. [6]
The implication for reward leaders: the current legal exposure is concentrated in the easier violation — omission — precisely because it’s the one plaintiffs’ firms can prove without ever reaching the harder question of whether a posted range was methodologically sound. That harder question has not yet been the center of a major enforcement wave. It is the more expensive one when it arrives, because unlike an omitted range, a defective range requires the employer to reconstruct, after the fact, a rationale nobody documented at the time.
5. The EU just set a materially higher bar — and multinationals now run two standards at once
The EU Pay Transparency Directive’s Article 5 requires that candidates be informed of a role’s starting salary or pay range before the first interview, and specifies that the range must be based on objective and gender-neutral criteria. [7] That single phrase — objective, gender-neutral criteria — does something no US “good faith” standard does: it points directly at a required methodology, not merely a sincere belief. Satisfying Article 5 in substance, not just in form, means the range traces back to a job evaluation factor, a documented grading structure, or comparable evidence — the exact evidentiary trail no US statute currently demands.
The mechanism this creates for multinational employers is a live governance inconsistency. The same reward function, inside the same company, may be posting a US range built on a recruiter’s market instinct and an EU range required to rest on documented, gender-neutral evaluation criteria — for comparable roles, sometimes in the same global job family. The implication: global mobility and internal equity reviews will increasingly surface this gap on their own, well before any regulator does, the moment someone compares two postings for the same job level across regions and asks why only one of them can show its work.
6. The Gulf inheritance: the range travels before the law does
This is a practitioner observation from regional reward work, not a cited statistic, and should be read as such. As US- and EU-headquartered multinationals harmonize global hiring templates, UAE and Saudi Arabia subsidiaries increasingly get pulled into “good faith range” postings for regional roles — even where no local law requires disclosure at all. A global applicant tracking system or a group-wide compensation philosophy document doesn’t stop respecting a border the way legislation does.
The mechanism is exposure without protection. A GCC entity publishing a range because the global template requires it, without the job evaluation methodology behind it that a genuinely defensible range needs, inherits all of the reputational and internal-equity risk of transparency with none of the legal cover a properly derived range would provide. Importing the posting requirement without importing the methodology that should sit behind it is the regional version of the same mistake US employers are making at scale.
The question worth pulling before your next job requisition goes live
Take the range on your most recently posted role and ask one question of it: if a regulator, a plaintiff’s attorney, or simply a sharp internal-equity audit asked you to produce the basis for that number — not your belief, but the market data, the evaluation grade, or the internal comparator that justified it — could you produce it today?
If the honest answer is no, the range may still be legal. The two words protecting it were never designed to test whether it was right.
References
[1] Netchex, “Pay Transparency Laws in 2026: What Multi-State Employers Need to Change in Job Postings,” 2026 — netchex.com/blog
[2] New York State Department of Labor, “Pay Transparency Act Frequently Asked Questions,” and JTNY Law, “New York Pay Transparency Law: 2026 Compliance Guide,” 2026 — dol.ny.gov; jtnylaw.com
[3] California SB 642 (2025–2026), effective 1 January 2026; Massachusetts Section 105F (Frequently Asked Questions), effective 29 October 2025 — mass.gov
[4] New Jersey Department of Labor and Workforce Development, proposed regulations implementing the Pay Transparency Act, as summarized by Saul Ewing LLP, October 2025 — saul.com/insights
[5] Federal Reserve Bank of New York, Liberty Street Economics, “Do Employers Comply with Pay Transparency Requirements in Job Postings?”, 2 October 2025 — libertystreeteconomics.newyorkfed.org
[6] Foothold America, “US Pay Transparency Revolution: New Salary Disclosure Laws,” 2026 — footholdamerica.com/blog
[7] European Commission and Council of the European Union, Pay Transparency Directive (EU) 2023/970, Article 5; European Commission, “New EU Rules on Pay Transparency Explained,” 5 June 2026 — commission.europa.eu; consilium.europa.eu
RewardEdge Consulting advises organizations on job architecture, grading, and pay structure design. To pressure-test whether your posted ranges could survive a real audit — not just a good-faith belief — start at rewardedge.co
