Massachusetts Attorney General Releases Guidance on An Act to Establish Pay Equity

Pay EquityOn July 1, 2018, an updated equal pay law will go into effect in the state of Massachusetts. An Act to Establish Pay Equity will prevent pay discrimination for comparable work based on gender. The Office of the Massachusetts Attorney General has recently released a guidance to help employers prepare for the new law.

The guidance titled “An Act to Establish Pay Equity: Overview and Frequently Asked Questions” provides an overview of the Act, a form of frequently asked questions, a guide to conducting a self-evaluation, and a sample checklist of policies and practices. The guidance clarifies that differences in pay for comparable work are allowed only when based upon the following:

  • a system that rewards seniority based on length of service with the employer. The time employees spend on leave due to pregnancy-related conditions and protected parental, family, and medical leave, may not be counted to reduce seniority for purposes of the law;
  • a merit system that provides for variations in pay based upon employee performance as measured through legitimate, job-related criteria;
  • a system that measures earnings by quantity or quality of production, sales, or revenue is a system that provides for variations in pay based upon the quantity or quality of the employee’s individual production or sales and other revenue generation in a uniform, reasonably objective fashion;
  • the geographic location of the job may constitute a valid reason for variation in pay if the cost of living or the relevant labor markets differ from one geographic location to another;
  • employee travel will justify a pay differential if it is a regular and necessary condition for the job. Variations in pay based on travel are not permitted where there are alternatives to that travel, the travel is part of an employee’s regular commute, or the travel is based on the employee’s preference to travel; and
  • education, training, and experience will justify variations in pay if they are reasonably related to the job in question and, at the time the employee’s wages were determined, a reasonable employer could have concluded the skills would be valuable in the particular job.

The guidance also clarifies that an employee or applicant who believes his or her rights under the law have been violated may file a claim in court. The employee or applicant may also file a complaint with the Attorney General’s Office. The Attorney General may decide to file a claim in court on behalf of one or more employees or applicants. An employer that violates the law by paying an employee less than it pays to employees of a different gender performing comparable work may be liable for:

  • the amount of the affected employee’s unpaid wages;
  • an equal amount of unpaid wages; and
  • the affected employee’s reasonable attorneys’ fees and other costs if he or she is awarded any judgment in his or her favor.

Surprisingly, the law also 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. The guidance elaborates that 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 may reveal. A good faith self-evaluation is one that an employer conducts in a genuine attempt to identify any unlawful pay disparities among employees performing comparable work. This good faith requirement applies to both an employer’s analysis of which jobs are comparable and to its analysis of pay differentials. The guidance provides templates and checklists to help guide employers in conducting self-evaluations.

Employers should take the time to review this guidance before the new law becomes effective. Employers considering conducting self-evaluations are advised to do so now, as it may take time to complete these assessments.

Leave a Reply

Your email address will not be published. Required fields are marked *