A troubling pattern has emerged in American workplaces: legislation designed to protect women from harassment and ensure fair pay may actually be making their professional lives more difficult. New research from Yale University and Cornell reveals that companies are responding to these protective measures in ways that lawmakers never intended, creating fresh obstacles for female workers seeking employment and fair compensation.
**The Unexpected Impact of NDA Reform**
The #MeToo movement sparked a wave of legislative reforms beginning in 2018. States including California, New York, and Washington passed laws restricting the use of non-disclosure agreements (NDAs), which had long silenced victims of workplace harassment. In 2022, Congress enacted the Speak Out Act, preventing employers from requiring workers to sign NDAs before any incident occurs.
These reforms received widespread support as necessary steps toward accountability. However, Song Ma, a professor of finance and entrepreneurship at Yale, discovered a disturbing side effect when examining startup hiring patterns.
His research, published earlier this year, found that startups in states with NDA-weakening laws hired approximately 8% fewer women annually compared to startups in states without such legislation. For context, the average startup in his study hired just over one woman per year, making this reduction particularly significant.
The pattern emerged immediately after the laws took effect and persisted for years. The impact was most pronounced in small, male-dominated startups lacking robust HR infrastructure, and primarily affected junior-level women – precisely those the laws were meant to protect.
**Historical Context: A Pattern of Backfiring Regulations**
This phenomenon isn’t unprecedented in American labor law. Similar unintended consequences followed the 1990 Americans with Disabilities Act, after which employment among disabled workers actually declined as employers sought to avoid compliance costs. Ban the Box laws, intended to help people with criminal records find employment, ended up harming young Black men when employers resorted to demographic stereotyping in the absence of criminal background information.
In each case, employers circumvented regulations by simply avoiding hiring the very people these laws were designed to help.
**The Salary Transparency Paradox**
Pay transparency laws represent another well-intentioned reform producing mixed results. Beginning with Colorado’s Equal Pay for Equal Work Act in 2021, followed by similar legislation in New York, California, and other states, these laws require employers to post salary ranges for open positions.
The goal was straightforward: address persistent wage gaps where women earn approximately 83% of what men make for full-time work, with Black and Latina women earning just 66% and 58% respectively.
Yet research by Alice Lee, an assistant professor of organizational behavior at Cornell, reveals significant flaws in implementation. After analyzing nearly 10 million job postings, her team found salary ranges averaging $38,000 in width, with some spanning over $100,000.
This matters because women demonstrate a stronger preference than men for positions with narrower, more defined salary ranges. Lee’s research shows that wider posted ranges correlate with lower female representation in the workforce, even after controlling for company size and other variables.
A 39-year-old healthcare professional in New York City, speaking anonymously, expressed frustration with vague salary ranges: “When a company posts a huge salary range, it feels like they’re just checking a box rather than genuinely complying with the law. It makes me wonder what other rules that company might be trying to bypass.”
**The Complexity of Workplace Dynamics**
Even when transparency measures work as intended, they can create unexpected problems. Research from the University of California, Riverside found that when workers learn their relative pay rankings, those near the top gain confidence while lower-ranked employees become demoralized and less likely to negotiate raises.
This knowledge can also affect workplace collaboration and motivation, with lower-paid workers showing decreased engagement after discovering pay disparities. Some studies suggest that extreme transparency might even reduce overall wages by limiting workers’ bargaining power.
**Finding Solutions That Actually Work**
Despite these challenges, experts aren’t advocating for abandoning protective legislation. Instead, they emphasize the need for more thoughtful implementation and institutional support.
Ma’s research offers some encouragement: while NDA bans reduced female hiring, they also correlated with more women reaching managerial positions, possibly due to increased turnover among male managers who left after the reforms.
Importantly, larger firms with established HR departments showed no reduction in female hiring after NDA reforms, suggesting that proper infrastructure can help companies adapt to new regulations without discriminatory hiring practices.
Lee advocates for enhanced transparency requirements that go beyond simple salary ranges. Her research shows that providing contextual information about typical starting salaries and how employers determine offers effectively eliminates gender gaps in application preferences.
New Jersey has proposed capping salary range widths at 60% of the minimum salary, potentially offering a model for other states. Employers should also consider whether wide ranges genuinely reflect single positions or actually bundle together different roles that merit separate postings.
**The Path Forward**
Workplace consultant Ruchika T. Malhotra identifies a fundamental challenge: many organizations still operate with a zero-sum mindset, incorrectly believing that advancing equity disadvantages men. This persists despite World Bank predictions that closing global gender gaps in work and pay could increase global GDP by more than 20%.
The evidence suggests that legal reforms alone cannot create equitable workplaces. Success requires companies to develop robust internal systems, provide clear and useful information to job seekers, and genuinely commit to fairness rather than mere compliance.
As Lee notes, these laws represent genuine progress, but the next generation of policies must focus not just on whether employers disclose information, but on whether that disclosure actually serves its intended beneficiaries. The challenge now is ensuring that laws designed to protect workers don’t become new barriers to their success.
