Massachusetts strengthens its equal pay act
The Massachusetts Equal Pay Act (MEPA), passed in 1945, was the first state law of its kind. But it hasn’t provided enough detail to be useful to employees or stiff enough penalties to be compelling for employers. The amendments to MEPA, which take effect July 1, 2018, make the law significantly more relevant.
Equal Pay for Equal Work
Under the updated MEPA, employers are prohibited from paying employees who do “comparable work” different wages because of sex. Wages include all forms of compensation, including benefits. Comparable work is work that involves substantially similar skill, effort, and responsibility and is performed under similar working conditions. Employees who do comparable work may not necessarily have the same duties or even be in the same department.
Acceptable Reasons for Pay Differentials
The only acceptable reasons for a pay differential between employees of different sexes who do comparable work are the following:
- A seniority system (time missed because of pregnancy or protected parental, family, or medical leave may not reduce seniority);
- A merit system;
- A system that measures earnings by quantity or quality of production, sales, or revenue;
- The geographic location in which a job is performed;
- Education, training, or experience—to the extent such factors are reasonably related to the job;
- Travel that is a regular and necessary condition of the job.
Note that there is no catch-all provision, such as “or any other factor not related to sex.” Employers should ensure that differentials can be fully explained by one or more factors from this six-point list.
Salary History Inquiry Ban
The law makes it illegal for employers to ask an applicant about their salary history until an offer of employment that includes compensation has been made. If an applicant volunteers their salary history, an employer may verify it, but employers should not in any way encourage candidates to disclose this information. Salary history is not an acceptable reason for a pay differential.
Discussion of Wages Must Be Allowed
MEPA bans pay secrecy practices and policies, such as blanket prohibitions on discussing wages or assertions that wages are confidential.
An employee’s right to discuss their wages is protected federally by Section 7 of the National Labor Relations Act, although it only applies to non-management and requires that employees are acting together to improve their wages. The Massachusetts law, however, applies to all employees and does not require any group action. For instance, under MEPA, a middle manager may go to their supervisor and inquire about the wages of the CFO, their peers, or their subordinates simply because they are curious on their own behalf. They may also discuss their own wages with whomever they like, as well as the wages of other employees who shared that information with them freely.
The law does not require that an employer (or other employees) provide an employee with the requested wage information, but it does prohibit any adverse action or retaliation against an employee for asking.
Self-Evaluation and Remediation as a Defense
Employers will have an affirmative defense under the law if they have undertaken a good faith self-evaluation within the last three years and can show that reasonable progress has been made toward eliminating any pay discrepancies. The self-evaluation must be of reasonable detail and scope.
Action Items for Employers:
- Conduct a self-evaluation. Assess your overall pay structure, pay bands for job groups, and individual wages. Focus on whether differences in pay can be fully and reasonably explained by the six factors allowed under MEPA, and if they cannot, make adjustments.
- Be aware that you cannot lower the compensation of one or more employees to equalize pay.
- Remove any policies related to pay secrecy from handbooks, confidentiality policies, and offer letters, and ensure that those with the authority to discipline are aware of the protections provided by the law.
- Train anyone involved in the interview process to steer clear of salary history questions.
- Ensure that your application forms don’t ask for salary history.
- For additional information, guidance on performing a self-evaluation, and a policy-and-practices checklist, bookmark or download this guide from the Massachusetts Attorney General.
From the CheckWriters HR Support Center