As the pandemic has stretched on, the media has been endlessly saturated with stories of businesses unable to attract workers. Rather than attempt to attract a historically underpaid workforce with improved benefits or raised wages, however, many employers are attempting to lure in prospective employees with false promises of wages they will never receive.
In recent months, workers have taken to the Internet to protest, or else spoken to reporters, about job postings that list higher wages than are actually offered once a candidate interviews. Reddit’s worker-oriented “anti-work” forum has multiple posts from disillusioned job-seekers who have responded to job postings advertising a set wage only to be told in an interview that the actual pay is significantly lower. According to reporting, major companies like Costco, Applebee’s, and McDonald’s have all attempted this type of salary bait-and-switch.
Workers May Still Accept These Positions
One worker, Alex, told a reporter that he initially responded to a “help wanted” post for office-supplies giant Staples offering $16 an hour. After he had interviewed for the position, however, he was told that the job actually paid $10 an hour. “They teased me with this possibility of being able to provide for myself,” he told the nonprofit More Perfect Union. Despite Staples’ clear deception, Alex had no choice but to accept the position, even knowing that the pay would not cover his basic necessities: “[I]t was really a rock and a hard place situation. I didn’t have a choice. I had to take the work.”
Life in the United States is exceptionally, and increasingly, expensive. Thus, many job-seekers, especially those with limited financial resources or with families to support, may need work immediately and feel they have no option but to accept a position, even if the pay is less than initially promised. However, in a market where worker demand is unusually high and employers are having to do more and more to fully staff their businesses, it’s worth further exploring why employees still take positions after an employer’s deception is revealed.
Some of an applicant’s decision to accept a position may be based on sunk costs — after already going through the process of an application and an interview, fatigued applicants may be willing to accept less than they could earn elsewhere just to end the process. This might be especially true for applicants with significant responsibilities and little time to dedicate to a job search. Employers may also tell job-seekers that while their starting rate will be lower than advertised — perhaps because of an applicant’s “lack of experience” — they might receive the higher pay after some period of time. Whether or not this is an empty promise, hopeful workers may welcome the chance of eventually earning the initially offered pay. Finally, some journalists have speculated that workers are weary of rejecting job offers for fear of losing unemployment benefits and being left with no income whatsoever.
Companies are undoubtedly relying on all of these concerns: they hope that the promise of higher pay will lure in prospective employees, and that when they reveal the real compensation, demoralized and manipulated workers will feel they have no choice but to accept the position anyway.
How Can This Be Legal?
Companies’ attempts at deception are clearly reprehensible — but applicants often lack realistic legal recourse. A misled applicant could potentially bring suit against an employer for breach of contract or for fraudulent inducement of employment, but success in either claim would be difficult.
Courts have found employers guilty of breach of contract where they fail to pay the salary agreed upon in an interview, or where salary wasn’t discussed and a hired employee is paid less than an advertisement’s stated salary. Generally, however, job advertisements aren’t considered binding offers, but rather invitations to enter negotiations. Thus, if an employer indicates during an interview that the salary is less than what was posted, a court will likely treat this as a valid modification. This is especially true if the employer tells the applicant, as they often do, that because of their level of experience, they have to start them at a lower pay rate.
Fraudulent inducement claims, meanwhile, require proving that an employer intentionally misrepresented something to convince a worker to take a position. Unfortunately, if an employer later informs a job-seeker that the salary won’t be what was advertised, then they aren’t taking a job on the basis of incorrect information. Courts are concerned with employers tricking workers into jobs, not tricking them into interviews. Even if these claims were more feasible, lawsuits are expensive and time consuming, and many job-seekers lack the necessary resources to pursue these claims.
Outside of unreliable contractual claims, workers are largely out of luck. While the federal government does regulate advertisements in some areas — like housing — it does nothing to ensure that employers are honest about wages in job advertisements. Instead, it’s up to the states to decide whether they want to require honesty from employers, and unfortunately, most do not.
Some states and localities, most notably Colorado and New York City, have begun in recent years to pass laws requiring real pay transparency from prospective employers in job advertisements. These laws — while directly aimed at employers that include no pay information in their job posts — may help protect job-seekers from the bait-and-switch tactics described above. Colorado’s Equal Pay for Equal Work Act requires that employers provide a pay range in any job posting, as well as information about all expected benefits. A newly passed NYC law similarly requires that employers include a “good faith” pay range in advertisements.
Several other states maintain less stringent pay-disclosure requirements. For example, Nevada requires that employers proactively provide pay ranges to applicants, but only after a job-seeker has completed an interview. In Connecticut, employers need not provide a pay range to an applicant until after they’ve offered them the position, unless the applicant specifically requests it. In Washington state, companies must provide pay ranges only to applicants who request them and who have already received an initial offer of employment.
These laws, while undoubtedly a step in the right direction, don’t do enough to stop employers from needlessly wasting job-seekers’ time and energy. Workers shouldn’t have to go through the process of applying for a position and completing an interview just to learn that the job pays too little to be a realistic option. This information should be available at the outset, and without workers having to actively request it.
Backlash to Transparency Reform
Unfortunately, positive state legislative reforms may be stymied by employers’ bad-faith attempts to evade pay-transparency requirements. Since Colorado’s law went into effect, numerous non-Colorado employers have attempted to avoid compliance by advertising jobs that applicants can perform remotely from any state, except Colorado. Colorado’s law applies to any employer, in-state or otherwise, with even one employee located in Colorado. Thus, companies are working overtime to avoid pay-transparency requirements by ensuring that none of their employees are based in the Centennial State.
The backlash to Colorado’s pro-worker requirements, and companies’ attempts to evade them, suggest a need for stricter state regulations, or even federal reform. If the federal government were to pass a comprehensive law requiring disclosure of accurate pay ranges in job advertisements, then employers’ efforts to manipulate workers would be thwarted and job-seekers would be guaranteed honest information.