August 24, 2016
This month, the Massachusetts legislature passed landmark equal pay legislation, making it the first state to ban the common practice of employers asking job applicants for their salary histories.
Bill S.2119 189th, also known as “An Act to establish pay equity,” is being hailed as “the most robust equal pay law in the country,”* and requires employers to pay workers of different genders the same wages, including benefits and other compensation, for comparable work. This law is a departure from many existing laws that forbid discrimination only for the exact same work performed by female and male employees.
Under the Massachusetts law, employers may pay workers different salaries, including benefits and other compensation, if they have a bona fide system that calculates different pay based on geography, merit, quantity or quality of production or sales, business necessity, travel, education or seniority—with protected family or medical leave having no reducing effect on seniority—among other metrics. Massachusetts employers may not reduce existing employees’ pay in order to comply with the new law.
In addition to protections against gender discrimination, the law makes it unlawful for employers to: (1) require confidentiality from or otherwise prohibit discussion by their employees regarding wages, including benefits and other compensation; (2) screen prospective employees based on wage histories, which includes requiring disclosure of prior wages or salary history, or requiring that an applicant’s salary history fall below a maximum or above a minimum amount; (3) seek wage history from a job applicant’s past or current employers prior to extending the applicant an offer of employment; and (4) fire or otherwise retaliate against employees who disclosed employee wages or inquired about other employee wages, opposed disclosure of wages, or complained or testified regarding an investigation or alleged violation under the new law.
The law also reduces barriers for employees or prospective employees seeking to bring an action against employers for violations under the law. For actions stemming from alleged violations of the new law, an employee is not required to file with the Massachusetts Commission Against Discrimination prior to bringing an action against an employer. The law also limits potential defenses that an employer may deploy if alleged to be in violation of the law. For example, if an employer is alleged to pay a female employee less than a male employee for comparable work, “[a]ny agreement between the employer and any employee to work for less than the wage to which the employee is entitled under this section shall not be a defense to an action.” Similarly, an employee’s prior wage history may not form a defense to an allegation of disparate pay.
If one or more employees brings a successful legal action and an employer is found to have violated the new law, the employer will be subject to a number of penalties, including not only unpaid wages, benefits and other compensation, but also an additional equal amount of liquidated damages.
While the new law takes effect in 2018 in Massachusetts, it marks the latest in a wave of progressive state and city employment laws and may be used as model legislation in other states. Earlier this month, a bill was introduced in the New York City Council which, if enacted, would similarly prohibit employers from asking employment applicants to provide their salary histories, including benefits.
This article is intended only as a general discussion of these issues. It is not considered to be legal advice or relied upon. For more information regarding employment law, please contact Reavis Parent Lehrer LLP Associate Ethan Krasnoo, who regularly counsels clients on employment, intellectual property, and commercial litigation matters. Mr. Krasnoo is admitted to practice in New York State, the U.S. District Courts for the Southern and Eastern Districts of New York, the U.S. Court of Appeals for the Second Circuit, and U.S. Tax Court.
* Bryce Covert. (2016, August 18). Massachusetts Becomes First State Ever To Ban Employers From Asking For Salary Histories. Think Progress, Retrieved from https://thinkprogress.org/massachusetts-becomes-first-state-ever-to-ban-employers-from-asking-for-salary-histories-3dd99768f8fe?gi=265dfe807205.