Massachusetts Enacts Expansive New Equal Pay Legislation

Lev Craig

Despite major societal advances in gender equality in the past several decades, pay disparities between men and women are still a pervasive problem in American workplaces. In 2014, the median earnings of women who worked full-time were 83 percent of those of their male counterparts, according to the Bureau of Labor Statistics. Last week, in an important step towards eliminating gender-based compensation inequities, Massachusetts enacted bipartisan legislation that has been called “one of the strongest equal pay bills in the nation.”

There are already several federal statutes in place that are intended to establish equal pay for employees of all genders: The Equal Pay Act of 1963 (“EPA”) prohibits employers from paying unequal wages to men and women who perform substantially equal jobs, and Title VII of the Civil Rights Act of 1964, the Americans with Disabilities Act, and the Age Discrimination in Employment Act forbid compensation discrimination on the basis of race, color, religion, sex, national origin, age, or disability. However, the new Massachusetts law has notable differences from these federal statutes, including an entirely unique provision concerning an employer’s ability to ask about a prospective employee’s history of compensation.

Many job applicants have encountered questions about salary history in interviews and applications. For women who are paid less than their male counterparts, such questions often have the effect of entrenching and perpetuating gender-based pay disparities. However, once the recent Massachusetts legislation goes into effect, Massachusetts will become the first state in the country to prohibit such questions in the hiring process. By forbidding employers from considering prior compensation when they determine the salaries of new employees, the thinking goes, women won’t end up being locked into lower salaries due to previous employers’ sex-based discrimination in compensation. This provision helps other minority groups, as well, such as black men, who earn only 76 percent as much as their white counterparts.

The statute also creates less strict standards for what constitutes similar work than the EPA, which states that an employer may not pay employees who perform “equal work on jobs the performance of which requires equal skill, effort, and responsibility” differently on the basis of sex. The Massachusetts law, on the other hand, requires only that work be “substantially similar in that it requires substantially similar skill, effort and responsibility and is performed under similar working conditions,” in contrast to the EPA’s stricter requirement that work be “equal.” Consequently, employees alleging pay disparity have a greater number of comparators under the Massachusetts law than under the EPA.

In addition, the law puts more pressure on employers to proactively address wage disparities and compensation policies. It incentivizes employers to investigate their own pay practices by allowing an employer an affirmative defense against pay discrimination claims if that employer has “within the previous 3 years and prior to the commencement of the action…completed a self-evaluation of its pay practices in good faith and can demonstrate that reasonable progress has been made towards eliminating compensation differentials based on gender.” Additionally, the law creates stricter policies for what constitutes a legitimate, non-discriminatory reason for pay inequities. Under this legislation, pay disparities that an employer attributes to education, training, or experience must be “reasonably related to the particular job in question and consistent with business necessity,” and “time spent on leave due to a pregnancy-related condition and protected parental, family and medical leave, shall not reduce seniority”—a particularly important provision, considering that seniority systems are one legitimate reason for differences in compensation and that the wage gap is often exacerbated for working mothers.

While comparable equal pay legislation has not yet been enacted in New York, New York employees are protected by federal statutes, as well as the New York State Human Rights Law and the New York City Human Rights Law. If your employer has discriminated against you based on your gender, contact The Harman Firm, LLP.