On July 31, 2024, Massachusetts became the latest state to pass a pay transparency law, titled the “Frances Perkins Workplace Equity Act” (the Act), joining four states and numerous municipalities that have enacted similar laws in the last few years. This Act has imposed two new obligations on covered employers: salary range disclosure and pay data reporting.

Salary Range Disclosure

Effective July 31, 2025, all employers with 25 or more employees in Massachusetts will be required to include a “pay range” in all job postings. This requirement applies to “any advertisement or job posting intended to recruit job applicants for a particular and specific employment position,” regardless of whether the posting was made by the employer or through a third party, such as a recruiter. The Act also requires covered employers to (a) disclose to employees who are being offered a promotion or transfer the pay range for the new position; (b) disclose to employees the pay range for their current role upon request; and (c) disclose to applicants the pay range for a specific position upon request. 

The Act defines “pay range” as “the annual salary range or hourly wage range that the covered employer reasonably and in good faith expects to pay for such position at that time.” Although prior versions of the law included a disclosure obligation of “other compensation,” which would have included bonuses, stock options, commission, and other pay, that is noticeably absent from the Act, which may suggest that disclosure only applies to the base salary or hourly wage.

The Massachusetts Attorney General is responsible for enforcing this law. Notably, the Act defines an offense as “1 or more job postings for positions made by the same employer during a 48-hour period.” This suggests that if a covered employer makes multiple job postings for roles that are non-compliant with this Act, the covered employer will be liable for only one offense as long as the postings all appeared within the same 48-hour window. Covered employers will be issued a warning for a first offense; subsequently, they will be fined $500 for a second offense and $1,000 for a third offense. For fourth and subsequent offenses, the Attorney General will have the authority to issue civil citations ranging up to $25,000.

The Act explicitly states that violations will not be subject to treble damages under the Massachusetts Wage Act. In addition, for the first two years following the effective date, covered employers will have a two-business-day grace period following notice of an offense, during which they can fix all discrepancies before any fines are imposed. Finally, the Act prohibits covered employers from retaliating or discriminating against employees or applicants for seeking to enforce their rights under the Act; however, there does appear to be a private right of action available for retaliation or discrimination claims.

Pay Data Reporting

The Act also imposes new pay data reporting obligations on employers with 100 or more employees within Massachusetts if those employers are subject to federal Equal Employment Opportunity (EEO) report requirements through the filing of the EEO-1. Specifically, covered employers will now be required to submit an annual report of pay data categorized by race, ethnicity, sex, and job category to the Secretary of the Commonwealth; however, employers may submit the federal EEO-1 report to satisfy this requirement. These reports must be submitted by February 1 each year, with the first report due no later than February 1, 2025. The Secretary of the Commonwealth will subsequently publish the aggregate data from these reports onto the Massachusetts Department of Labor website, but individual employer reports will not be publicly available.

Recommended Next Steps

Massachusetts has joined numerous states in passing the Act, following a nationwide trend toward pay transparency and disclosure. For example, Washington, DC passed a similar law that recently took effect on June 30, 2024; a Maryland law takes effect on October 1, 2024; laws in Minnesota and Illinois both take effect on January 1, 2025; and a Vermont law will take effect on July 1, 2025. In advance of such laws, employers should evaluate the state and local pay transparency obligations in states and cities where the employer recruits from and develop strategies to meet these compliance requirements. Employers may need to coordinate with their internal and external recruiters, hiring managers, talent acquisition teams, and others. Employers, especially those who may be managing multi-state compliance in this area, should consider consulting competent legal counsel for assistance.