Massachusetts’ New Pay Equity Law is a Milestone in Closing the Gender Wage Gap

   As of July 1, 2018, Massachusetts’ new pay equity law will prohibit employers from asking job applicants to disclose their wage and salary history on job applications.

According to the law, all public and private employers are prohibited from discriminating in any way on the basis of gender in the payment of wages or paying any employee a salary or wage rate less than the rates paid to their employees of a different gender for comparable work. The new law also prohibits Massachusetts employers from barring employees to discuss their salaries with each other.

According to the U.S. Census Bureau, women earn 70 cents for every dollar earned by men. By using salary history on job applications as a guideline for pay, this inequity has a tendency to follow workers throughout their professional lifetime.

Other states, such as Maryland and California, have similar legislation focused on reducing pay inequity and salary secrecy. However, according to Karim Fadel of Boston-based Unison Realty Partners, the key difference in the Massachusetts law is, “Instead of tackling the consequences of unequal pay, the Massachusetts law will focus on making equal pay for equal work the gold standard from the moment a prospective employee walks in the door.”

Companies are now required to post a minimum salary in job ads and pay any hire at least that amount. It should be noted that employers will be able to ask an applicant what he or she “hopes to earn” in the new position.  However, that practice might be open to interpretation in a court of law.

The new law lengthens the time an employee has to bring a pay discrimination suit from one to three years and allows for the awarding of attorneys’ fees. It also clarifies that analysis of “comparable” work must be based on skill, effort, responsibility and working conditions. An employer is allowed to defend itself against gender discrimination claims if the company conducts a self-evaluation of workplace job classifications and wage rates.

Wage differentials are permitted based on:

• A seniority system,
• A merit system,
• A system that measures earnings by quantity or quality of production or sales,
• Geographic locations in which a job is performed,
• Education, training or experience to the extent such factors are reasonably related to the particular job in question, and
• Travel, if it is a regular and necessary condition of the particular job.

The new law expands the existing groundbreaking pay equality law that was enacted in Massachusetts in 1945.

All employers should take note and prepare for this law to become an issue in their state. It is expected that many states as well as the U.S. Congress will adopt similar laws within the next two to five years.

 

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