Effective October 1, 2021, Connecticut employers will have new significant pay equity obligations. Signed into law on June 7, 2021, House Bill No. 6380 (An Act Concerning the Disclosure of Salary Range for a Vacant Position) applies to all organizations within the Constitution State that have at least one employee. Although HB 6380 amends Connecticut law in a number of ways, two provisions immediately stick out for which employers should consider preparing for now.
First, HB 6380 creates the obligation to disclose wage ranges within two important contexts:
Employers must disclose the wage range to applicants for the position applied for upon the earliest of A) the applicant’s request for those wage rates, or B) prior to or at the time of making a job offer;
Employers must disclose wage ranges to the employee for the employee’s position at the one of following prescribed times: A) upon hire, B) upon a change in position, or C) when first requested by the employee.
Let’s unpack these new obligations. To start, what is a “wage range” as defined by HB 6380? Wage range means: “the range of wages an employer anticipates relying on when setting wages for a position, and may include reference to any applicable pay scale, previously determined range of wages for the position, actual range of wages for those employees currently holding comparable positions or the employer’s budgeted amount for the position.”
In other words, “wage range” under HB 6380 means the pay minimum and maximum set for a specific position, which may take into account several different factors, such as budgets or prior wages paid for a certain role. These wage ranges must be disclosed at the prescribed points in the hiring, onboarding, or change in positions processes.
Second, HB 6380 broadens the pool of comparable employees for purposes of equal pay violations. Previously, organizations in Connecticut were prohibited from discriminating on the basis of sex in the payment of wages to employees performing equal work, “the performance of which requires equal skill, effort, and responsibility and which are performed under similar working conditions…” This language echoes the requirements of the federal Equal Pay Act of 1963.
However, like many other states across the U.S. whose legislatures have determined the Equal Pay Act is insufficient in its protections against sex-based pay discrimination, Connecticut broadened this language to prohibit pay discrimination on the basis of sex for comparable work on a job, when viewed as a composite of skill, effort and responsibility, and performed under similar working conditions.
This change from equal to comparable is substantial in that it allows aggrieved employees or applicants to select from a broader pool of comparators when making equal pay claims.
What should employers do to prepare for when HB 6380 takes effect on October 1? First and foremost, they should be proactive. The consequences for the failure to act are severe. Aggrieved applicants or employees can sue for compensatory damages, attorney’s fees and costs, and punitive damages. Further, the statute of limitations to sue is two years from the last violation of HB 6380.
Employers should consider updating their hiring, onboarding, and change-in position procedures now in order to be ready to respond to the inevitable wage disclosure requests. More importantly, they should consider a comprehensive pay equity audit to ensure pay disparities are brought to light and addressed before wages are disclosed to applicants and employees. Such an analysis can tell you, on an individual, department by department, or company-wide level where pay equity and DEI issues exist and how to proactively address them.
Conducting a pay equity audit is a key component to ensuring equitable compensation within your organization. Just as important as the analysis is how you communicate findings and progress with various stakeholders. Download The Pay Equity Communications Planner to learn best practices for discussing compensation, both internally and externally.