/>iMassachusetts has adopted new wage transparency requirements for employers, joining a growing list of other states and cities.
The new law contains two distinct wage transparency measures that apply depending on the employer’s size: (1) Pay range disclosure requirements, and (2) wage data reporting to the state.
Gov. Healey signed An Act Relative to Salary Range Transparency (Chapter 141 of the Acts of 2024) on July 31, 2024. The pay range disclosure requirement will take effect on Oct. 29, 2025, one year after the effective date of the act. The first set of wage data reports are due by Feb. 1, 2025.
Pay Range Disclosure Requirements
This section of the bill applies to public or private employers with 25 or more employees in the Commonwealth. The law does not address whether it applies to positions that could be filled by an employee working remotely in Massachusetts.
Under the law, covered employers must
| 1. | Disclose pay ranges in any job posting; |
| 2. | Provide pay ranges to any employee to whom the employer offers a promotion or transfer to a new position with different job responsibilities; and |
| 3. | Upon request, provide the pay range to any applicant or an employee that already holds the position. |
The pay range must be set in “good faith” and can be an hourly wage range or annual salary range. The law covers any advertisement or job posting intended to recruit job applicants, including recruitment directly by a covered employer or indirectly through a third party.
Unlike other jurisdictions, Massachusetts does not require employers to list benefits or other compensation to be offered.
Wage Data Reporting to the State
Following states such as California and Illinois that have adopted similar requirements, the Massachusetts law uses existing federal wage data reports required by the Equal Employment Opportunity Commission (EEOC) to form the basis of a state wage data reporting regimen. The reporting requirement applies to public or private employers (1) with 100 or more employees in Massachusetts, and (2) that are subject to the federal wage data filing requirements.
Many private employers may already be familiar with EEO-1, the Employer Information Report promulgated by the EEOC. Under the new law, covered employers must also submit the EEO-1 data report to the Secretary of the Commonwealth (the Secretary). It also requires submission of the EEO-3 (local unions), EEO-4 (state and local government), and EEO-5 (elementary and secondary school staff) reports to the Secretary. The first EEO-1, EEO-3, and EEO-5 reports are due by Feb. 1, 2025, and the first EEO-4 reports are due by Feb. 1, 2026.
The law prescribes the following workflow for wage data reporting, regardless of what category the employer falls into:
| 1. | A covered employer must submit its wage data report (EEO-1, EEO-3, EEO-4, or EEO-5, as appropriate) for the prior calendar year to the Secretary by Feb. 1. Private employers that file EEO-1 reports must submit their wage data report annually. Organizations that file EEO-3, EEO-4, or EEO-5 must submit the report every other year. |
| 2. | Each year by April 1, the Secretary must transmit the wage data reports to the Executive Office of Labor and Workforce Development (EOLWD). |
| 3. | Annually by July 1, EOLWD must publish an aggregate wage data report grouped according to North American Industry Classification System (NAICS) code for the applicable industry. |
Though the individual employer wage data reports will not be considered “public records,” the aggregate wage and workforce data reports will be available for public review.
Anti-Retaliation Protections
The new law contains a provision prohibiting retaliation or discrimination against any employee or applicant because the individual has asserted or exercised any rights provided by the law.
Enforcement
The Massachusetts attorney general has exclusive authority to enforce both requirements and may obtain injunctive or declaratory relief. The law does not provide a private right of action for individuals.
For the first two years after the statute takes effect, employers will have two days after notice of a violation to cure the violation without penalty.
The bill prescribes the following penalties for violations:
- First offense: a warning
- Second offense: fine up to $500
- Third offense: fine up to $1,000
- Fourth or additional offenses: subject to the employer civil citation regime and penalty scale contained in MGL c. 149, sec. 27C(b).
A Possible Trend
With this enactment, Massachusetts joins several other states which have adopted wage transparency laws. Those laws fall into two primary categories: those, like Massachusetts, that require disclosure of salary ranges in a job posting or other publicized job description; and those that require disclosure of salary ranges at some point in the hiring process.
Massachusetts joins the following “job posting” jurisdictions: California; Colorado; Hawaii; Illinois; Maryland; Washington, D.C.; Minnesota; New York; Vermont; and Washington.
“Hiring process” states include Connecticut, Nevada, and Rhode Island.
Practical Considerations
Before the effective dates, covered employers should consider taking the following actions:
- Assessing covered job postings to ensure they include the required pay ranges;
- Training personnel responsible for preparing job postings and who may receive employee questions;
- Reviewing and updating the federal EEO process to include a state filing by Feb. 1, 2025, and thereafter;
- Monitoring forthcoming “public awareness campaign” materials from the Massachusetts attorney general’s office, which may include guidance on open items, such as whether the job posting requirements apply to remote work that could be done from Massachusetts.
