Legislative Update: Tougher Pay Equity Law Gets Closer to Reality

On January 28, 2016, the Massachusetts Senate passed amendments to the state’s Equal Pay and Fair Employment Practices Acts, with the goal of advancing the cause of gender-based pay equity in Massachusetts. These changes would create new rights and remedies for aggrieved workers and also place new rules and restrictions on Massachusetts employers in negotiating compensation with job candidates. The bill has now moved on to the House of Representatives for its consideration. Some of the highlights of the bill are as follows:

To begin with, the bill establishes a more expansive definition of “comparable work” under the Equal Pay Act. This law currently requires employers to pay men and women the same rates for jobs that share common characteristics, such as similar skills, effort, level of responsibility, and job content. Under the proposed amendment, an employer could no longer defend against a pay equity claim based on different job content, because the bill would allow jobs to be “comparable” even though the content of the work is substantively different.

In order to foster more transparency, the bill expressly permits employees to discuss their compensation with coworkers or colleagues.

The bill does not require employees claiming violation of the Equal Pay Act to first take complaints to the Massachusetts Commission Against Discrimination or the Attorney General’s Office. Rather, an aggrieved employee can go right to court, where, if the employee prevails, the employee can obtain “unpaid” wages and benefits, an equal amount of liquidated damages, and attorneys’ fees.

The bill greatly expands the statute of limitations for bringing a claim for unequal pay to 3 years, as compared to the 300-day period that applies to more typical employment discrimination claims in Massachusetts, or the one-year period that currently applies to Equal Pay Act claims.

Because women’s wages are historically lower than men’s, the bill would make it an unlawful practice under the state’s general anti-discrimination law for employers to ask candidates about their salary histories.

The bill would make it unlawful under the state’s general anti-discrimination law for an employer to post or advertise a job opening without listing a minimum rate of pay.

One particularly noteworthy aspect of the bill is that, in order to create incentives for proactive compliance, it creates an affirmative defense for employers that have completed a good faith “self-evaluation” of their pay practices within the past three years.

The Massachusetts pay equity bill does not come in a vacuum. There is a definite push from regulatory agencies to focus on the issue of pay equity.  In fact, on January 29, 2016, the day after the Massachusetts Senate passed the pay equity bill, the U.S. Equal Employment Opportunity Commission (EEOC) made public a proposed revision to the Employer Information Report (EEO-1) to include collecting pay data from employers, including federal contractors, with more than 100 employees. This new data is intended to assist the agency in identifying possible pay discrimination and assist employers in promoting equal pay in their workplaces.

Employers should take note of this heightened focus on issues on pay equity and consider conducting audits of their compensation practices.

Prince Lobel will continue to closely monitor the progress of this bill, and will provide a timely update should it become law.

If you have any questions about the information presented here, or have any employment law concerns, please contact  Daniel Tarlow, chair of the firm’s Employment Practice Group and the author of this alert, at 617 456 8013 or dtarlow@princelobel.com, or Laurie F. Rubin at 617 456 8020 or lrubin@princelobel.com.