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July 29, 2024

Massachusetts Pay Transparency Bill Headed for Governor's Signature

Massachusetts has enacted legislation relative to pay transparency for certain employers, which is expected to be signed promptly by Governor Maura Healey. The act aims to close the gender and racial wage gaps in the state and attract more competitive employment candidates to Massachusetts. The law is expected to take effect one year after the governor’s signature.

The final bill, “An Act Relative to Salary Range Transparency,” provides the following:

Employers with 25 or more employees are required to:

  • Include a salary range on a job posting;
  • Provide pay range information when a current employee is offered a promotion or transfer to a new position with the employer; and 
  • Upon request, provide the pay range information for a particular position to an employee that currently holds the position or an applicant for the position.

Employers with 100 or more employees are required to:

  • Share their federal wage and workforce data reports with the Massachusetts Executive Office of Labor and Workforce Development by February 1, 2025 (and annually thereafter); and 
  • Include in the reports workforce demographics and pay data categorized by race, ethnicity, gender, sex, and job category.

The legislation provides protection to employees who request wage information by barring employers from discharging, retaliating, or discriminating against employees who exercise their rights. 

Only the Massachusetts Attorney General has the authority to take legal action on behalf of individuals; employees or applicants cannot file their own lawsuit to enforce their rights under the law. 

Further, the act specifically provides that violations are not subject to treble damages under the Massachusetts Wage Act.

Potential Liability

An employer’s first violation shall be punishable by a warning, a second offense by a $500 fine, a third offense by no more than a $1,000 fine, and a fourth or subsequent offenses are subject to $7,500 to $25,000 fines per violation, depending on the circumstances.

Next Steps

Employers should examine their existing policies and procedures to ensure compliance with their job postings and reports. Additionally, employers should assess their readiness for pay transparency, considering potential employee reactions, and prepare a communication plan to mitigate employee-relations issues that could develop as a result of the new legislation. Employers with over 100 employees should prepare to submit their EEO workforce demographics and pay data to the state by February 1, 2025

If you have any questions regarding the content of this alert, please contact Carolyn Marcotte Crowley, partner, at ccrowley@barclaydamon.com; Sierra Leitten, summer associate, at sleitten@barclaydamon.com; or another member of the firm’s Labor & Employment Practice Area.
 

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