Pay equity, diversity and inclusion
New Guidance Issued on Massachusetts Pay Equity Law [UPDATE]
An update to the Massachusetts Equal Pay Act (MEPA) will go into effect on July 1, 2018, almost two years to the day when the new bipartisan pay equity bill was passed. The legislation is meant to ensure equal pay for comparable work for all Massachusetts workers and equal opportunities to earn competitive salaries in the workplace.
The law covers most employers who employ people within Massachusetts. It applies to full-time, part-time, seasonal, per-diem and temporary workers, including state and municipal employees.
State Attorney General Maura Healey has issued guidance on the new law as part of a dedicated webpage created to provide assistance to employers. In addition to the guidance, the webpage provides a basic step-by-step guide for employers that choose to conduct a pay equity audit of their organization. It features a calculation tool to assist employers in determining where they have potential wage gaps between male and female employees that require further review for compliance with the new law. You can view the new webpage by clicking here.
In the coming weeks, the AG’s Office will be partnering with business associations and others on a series of webinars and events to provide employers with guidance. The first webinar will be on March 22. You can register for the webinar by clicking here.
With July closer, here are steps Massachusetts companies can take to plan ahead.
First, understand MEPA’s salary history ban. If your job applications include a box with any language referencing a request for salary history, it must be eliminated by July 2018. Human Resource departments should be proactive now in revamping those applications, along with eliminating any questions about salary history during the hiring process.
Second, now is the time to conduct a pay equity audit. This may provide your company with valuable protection in the event that a pay differential exists within your organization and a pay discrimination claim is filed under state law. According to MEPA, an audit “may be of the employer’s own design, so long as it is reasonable in detail and scope in light of the size of the employer, or may be consistent with standard templates or forms issued by the attorney general.”
The new law actually encourages employers to conduct voluntary pay audits as an affirmative defense against possible violation of the law. Employers that have both completed a pay audit in good faith and can demonstrate that “reasonable progress” has been made towards eliminating wage differentials are provided a defense to any claims filed under MEPA and Massachusetts General Laws Chapter 151B, the state’s anti-discrimination statute. The law also provides relief from liability for liquidated damages under MEPA.
According to the AG’s guidance:
“An employer that violates MEPA generally will be liable for twice the amount of the unpaid wages owed to the affected employee(s)—the differential between the employee’s wages and the wages paid to an employee of a different gender performing comparable work—plus reasonable attorneys’ fees and costs. However, the law provides a complete defense for any employer that, within the previous three years and before an action is filed against it, has conducted a good faith, reasonable self-evaluation of its pay practices. To be eligible for this affirmative defense, the self-evaluation must be reasonable in detail and scope and the employer must also show reasonable progress towards eliminating any impermissible gender-based wage differentials that its self-evaluation reveals. Employers are not required to conduct self-evaluations and will not be penalized for choosing not to do so.”
The key advantage of conducting a pay equity audit now is that any discrepancies found in pay levels after analyzing the data can be addressed before the law goes into effect.
Having guidance from the state attorney general will assist employers in preparing for the new law’s implementation in July. Employers also may want to consider the use of qualified third-parties to ensure that appropriate processes are in place to address pay equity within their organizations.
Now is the time to make sure your company’s pay practices will conform with the new law before encountering challenges after the law goes into effect in July 2018.
To learn more about achieving pay equity, click here.