On July 1, 2018, the Massachusetts Equal Pay Act goes into effect and all Massachusetts employers must pay their employees’ wages on an equal basis without regard to gender. With this effective date fast approaching, employers must take immediate steps to comply with this new law.
The Equal Pay Act will prohibit an employer from wage discrimination on the basis of gender. The Act defines “Wages” to include “all forms of remuneration for employment.” The law prohibits the payment of wages or salary at a rate less than that paid to an employee of a different gender for comparable work. In some circumstances, an employer may have variations in its payment of wages based on:
- Seniority (but the time spent on leave due to pregnancy or other protected family or medical leave cannot reduce seniority);
- A merit-based system;
- A measurement of the quantity or quality of production, sales or revenue;
- Geographic location where the job is performed;
- Education, training or experience reasonably related to the job; and
- Travel, if it is a regular a necessary condition of employment.
This state law also prohibits employers from reducing the wages of an employee in order to comply with the Act. Employers cannot prohibit applicants from inquiring about wages or salary information, and employers cannot ask about the salary history of the applicant before a formal offer of employment. The Equal Pay Act comes with some steep penalties for employer violations. Employers will be liable for twice the amount of unpaid wages as liquidated damages and attorney’s fees and costs.
One unique aspect of this law - an employer may assert as an affirmative defense that the employer conducted a good-faith self-evaluation of its own pay practices and is progressing to eliminating gender-based pay differences within its workplace. This affirmative defense is only available so long as the self-evaluation occurred within three years before an employee’s claim, and the employer establishes a few other requirements referenced in this law.
Employers may take steps now to address any issues with wage disparities, including reviewing and amending employment applications that may ask for an applicant’s salary history. Employers should also provide training to their human resources or other management employees that conduct recruitment activities as to the appropriate questions to ask during interviews, including to not request salary history information. Additionally, employers should review and amend any policies that prohibit employees from discussing wage information.
The Office of the Massachusetts Attorney General published a helpful guide that provides an overview of the law, a list of frequently asked questions, a six-step compliance checklist and a check list for updating your policies. This guide can be downloaded at the following link:
AGO Equal Pay Act Guidance (5-2-18)
An employment attorney can assist with the above-referenced issues and conduct an audit for an employer to ascertain whether the employer’s policies or practices disparately impact women during annual reviews or other wage decisions. An audit conducted by an employment attorney will provide an employer with the information related to its wage practices and assist the employer with establishing a workplace with equitable wage practices.>