Best-Practices-for-Employee-Recordkeeping-Part-1

In August 2016, Massachusetts enacted a pay equity bill aimed to increase wage transparency, standardize salaries, and bridge the gender pay gap.  The Massachusetts Equal Pay Law, An Act to Establish Pay Equity, which will go into effect on July 1, 2018, will prevent pay discrimination for comparable work based on gender.

What Employers Need to Know

  • Employers must pay equal wages for comparable work.  Under the new law, comparable work is defined as work that is substantially similar, requiring similar skill, effort and responsibility and is performed under similar working conditions.  Comparable work is not limited to employees who have the same job title or job description.  The law does allow for certain pay differentials based on seniority, merit, geographic location, education, training, experience and travel.  However, pregnancy, family, or medical leave will not count against seniority.
  • To help eliminate unconscious bias, employers cannot ask prospective employees about their salary history before extending a formal job offer.
  • In an effort to encourage pay transparency, employers must allow employees to freely discuss their salaries with coworkers.  Employers cannot penalize or retaliate against employees for discussing wages.
  • If an employer discovers that they are in violation of the law, they will be allotted 3 years to amend the violation without punishment, if a good-faith effort is made.

What Employers Should Do

  • Remove inquires about salary history from job applications and the recruiting, interviewing and hiring process.
  • Revise any policies or practices that prohibit employees from discussing their pay.
  • Consider performing an internal equal pay audit and correct any discrepancies.  Employers may not reduce the pay of any employee in order to comply.  Note that an internal equal pay audit is not required.
  • Establish systems to maintain equal pay.
  • Train employees involved in the recruiting, interviewing, and hiring process – and those who make decisions regarding compensation – on the law’s requirements.
  • Educate employees about their rights and responsibilities.  There will be a posting requirement associated with this law.

The Attorney General will be responsible for issuing regulations interpreting and applying the law – and may release more information as the effective date gets closer.

Visit http://www.equalpayma.com/en/equal-pay-law, which includes an employer tool kit, a best practices guide designed to explain how to identify, understand, and promote equal pay in the workplace.

If you have any questions, or if Pfautz Consulting Group, LLC can help you as you prepare to comply with the Massachusetts Pay Equity Act, please contact us.

Submitted by Deborah M. McCormick