New legislation seeks to keep California employers from posting job notices for positions that don’t actually exist.
This is a growing trend called “ghost” job postings. Ghost job postings are ads for positions that employers have no immediate intention to fill. Candidates who usually don’t know this will apply and interview for these jobs—incurring significant time and expense—only to discover that the positions never really existed…or they never know that they’ve applied for and even interviewed for an imaginary position with a company.
The popularity of ghost job postings has become more of an issue recently. A 2024 survey from Resume Builder found that nearly 40% of responding companies posted a ghost job in the year prior, and 30% of respondents had an active ghost job listing at the time. In fact, other research shows that between 18% and 36% of all current job openings aren’t real.
According to Greenhouse, an online employment service, three industry sectors have the highest rate of ghost job postings: construction (38%), art (34%), and legal (29%).
Why Do Employers Post Ghost Jobs?
There are several reasons why an employer posts a ghost job, including talent pooling, with some companies keeping job listings up continuously to gather resumes and supplement their talent pipeline for potential future hiring. Some will use job postings for market research to assess the competitiveness of salaries or talent availability.
Companies also will use ghost postings to depict a healthy and expanding business to competitors, investors, and their staff. Similarly, other businesses may use the prospect of new hires to motivate their existing work force and to make them think that their workloads would be lessened with the new hires coming aboard.
Finally, there are employers who will post ghost job listings to fulfill compliance requirements, like demonstrating that they advertised positions externally prior to promoting internally or hiring those on work visas.
What Would the New Law Prohibit?
Ghost job postings create applicant frustration, mistrust, and inefficiency; however, those aren’t the only reasons that California lawmakers want to halt the practice. Regulators and privacy advocates worry that these postings result in unnecessary collection and storage of applicants’ personal data. Moreover, fake job postings could also distort labor market statistics, which make state officials believe that the job market is better than it is in reality.
The proposed bill (AB 1251) requires private employers to explicitly disclose in job advertisements that the advertised position is in fact an existing vacancy. Those who don’t provide this disclosure would violate the state’s unfair competition law under § 17200 of the Business and Professions Code.
The bill would require the Labor Commissioner to investigate complaints, and that agency would have the authority to impose administrative fines and issue cease-and-desist orders against non-compliant employers. The fines would be between $100 and $10,000 per violation.
The Labor Commissioner would determine the amount of the penalty based on the totality of the circumstances, including, but not limited to, whether the employer has previously violated the law. For a first violation, a penalty wouldn’t be assessed if the employer shows that all job postings have been updated to include the vacancy statement required by the law.
Takeaway
Eanet, PC will monitor the activity of the bill because of its potential effect on recruitment practices and compliance requirements in California. In the meantime, employers should consider reviewing their hiring practices and conducting compliance audits of current recruitment practices, policies, and procedures.
Contact us for more information and with any questions.