Pay Equity Guidance Arrives
On March 1, 2018, the Massachusetts Attorney General’s Office (AGO) released guidance on the Massachusetts Pay Equity Law. The law, which was passed in the summer of 2016 with an effective date of July 1, 2018, referenced possible guidance, templates and forms that the AGO may provide. Many employers have delayed their pay equity self-evaluations, in whole or in part, to ensure that their efforts are compliant with the anticipated guidance. This article will summarize key aspects of the guidance.
As a reminder, the Pay Equity Act amends the Massachusetts Equal Pay Act (MEPA) in several ways, including:
- It changes the focus in gender-based equal pay analysis from employees performing the same work to employees performing comparable work.
- It limits pre-employment salary inquiries.
- It prohibits employer restrictions on employee sharing of compensation information
- It prohibits employer retaliation against employees who exercise their rights under the MEPA.
- It establishes employee actions for damages resulting from gender-based wage differentials that cannot be justified under the statute.
- It provides an affirmative defense to such claims for employers that both conduct a pay equity self-analysis that is reasonable in scope and detail for their organization and demonstrates reasonable progress towards eliminating identified gender-based wage discrepancies.
The AGO’s guidance comes in 5 parts:
- Overview of the Law
- Frequently Asked Questions (FAQs)
- Appendix A: Self-Evaluations – A Basic Guide for Employers
- Appendix B: Sample Checklist – Policies & Practices Review
- Sample Calculation Tool
For employers seeking clarification on aspects of the law, the FAQs is the most salient portion of the guidance. Since this guidance comes in the form of FAQ, not regulations, it does not have the equal standing of a law or regulation. However, while courts are not bound by the guidance, they will be informed by it. Employers should look to the guidance to inform their compliance efforts. Some of the guidance they will find includes:
- Employees who work in another state but telecommute to a primary place of work that is in MA are covered by the law, even if they never physically enter MA.
- Employers may ask prospective employees about their salary expectations or needs.
- Full-time and part-time employees performing comparable work may be paid different hourly rates, or offered different benefits, “provided that employees of different genders within each category who perform comparable work are compensated at the same rate and offered the same benefits” and the employer does not “discriminate based on gender in terms of the assignment or availability of part-time versus full-time work.”
- Changes in the labor market do not justify salary differences among employees performing comparable work.
- Employees may only invoke the affirmative defense when their self-evaluation included either the employee or position that is the subject of the legal action.
The appendixes provide useful information for employers seeking to perform a self-evaluation and take advantage of the affirmative defense. They also state that the Calculator Tool provided by the AGO may be useful for comparable groups with fewer than 30 employees. Employers will likely need to perform simple or multivariate regression analysis on comparable groups with 30 or more employees.
Please join me for a more detailed discussion of the guidance materials and an examination of the immediate steps employers should take to get into compliance by July 1.
