On July 1, 2018 an Act to Establish Pay Equity (the “Act”) goes into effect. The Act prohibits discrimination in payment of wages on the basis of gender. Below is the fourth article in our series concerning the Act, which examines restrictions on salary inquiries by employers and other important provisions of the Act.
- Limitations on Prior Salary History Inquiries and Discussions about Pay
Massachusetts employers may be surprised to find that the Act prohibits employers from asking for salary history information from prospective employees. Under the Act, an employer may not seek information concerning a prospective employee’s prior salary. This limitation prohibits seeking prior salary information from prospective employees, as well as attempting to learn prior salary information from other sources such as from a prior employee. There are only two exceptions to this provision of the Act. The first exception is for situations where an employee voluntarily provides salary history information. The second exception applies where an employer has already made an employment offer to a prospective employee which includes compensation.
- Employers restrict Employees from discussing salaries.
Additionally, the Act makes it unlawful for employers to limit employees from discussing salary history and/or wages in the workplace. Workplace policies which prohibit such communications among employees will now be unlawful. Also, employers cannot contract with employees to keep them from disclosing their own salary information (such as entering into a non-disclosure agreement). Notably, these provisions would not apply to rules which prevent management and human resources employees from disclosing information about other employees’ salaries.
- Penalties and Enforcing the Act
The Act prohibits retaliation by employers against employees attempting to exercise their rights pursuant to the Act. Retaliation constitutes any type of adverse job action against an employee (such as demotion, transfer to an undesirable location, assignment to undesirable duties, or pay cuts).
The Act provides significant penalties for violations. An employer may be liable for an amount equal to DOUBLE the wages the employee would have earned if the employee had been paid the same amount as an employee doing comparable work. Also, the law would allow an affected employee to recover court costs and reasonable attorney fees in enforcing their rights under the law.
Although the Act prohibits discrimination, it is NOT enforced in the Massachusetts Commission Against Discrimination (MCAD). Rather, actions to enforce the Act are brought in the court system.
Please read the fifth installment in our series titled Part V: Safe Harbor-Voluntary Employer Salary Self-Evaluations. If you have questions about the Act, please contact Attorney Michael P. Doherty, Andrew M. Kepple or one of our other employment attorneys at 508 541-3000.