If you’re a dealer in Massachusetts, you now have new restrictions on your ability to make employee compensation decisions. Simply, you can no longer ask a prospective employee about their salary at their current or previous jobs.
Massachusetts has become the first state to bar employers from asking about an applicant’s salaries before offering them a job. A new law was signed Monday by Gov. Charlie Baker and will be effective July 2018. Proponents want it to serve as a national model.
Proponents say job seekers will no longer be compelled to disclose their previous salary or wages which, they claim, often leaves the applicants wondering if they would have been offered more money if the previous figure had been higher. (Applicants can, however, still volunteer their salary information.)
Accordingly, employers who routinely use previous pay as an important baseline for offering employment will now be required to state a compensation figure upfront, based on what an applicant is “worth to the company,” rather than on what they made in a previous position.
Obviously, the issue of men historically out-earning women who do the same job has made it to the “big screen” of today’s national political races. In Massachusetts, at least, this will prevent historically lower wages assigned to women and minorities from following along their entire career path, supporters say.
Of course there are federal equal-pay laws that prohibit gender-based pay discrimination already on the books, albeit they’re somewhat toothless and don’t see much enforcement. The Massachusetts law, on the other hand, has much more specific power.
For example, employers can no longer prohibit workers from telling others how much they earn. Further, the law mandates equal pay for both workers whose jobs are alike and for all employees whose work is of “comparable character” or who work in “comparable operations.” The law also broadens the definition of what is equal work, although workers with seniority can still be paid more.
According to Stacy Cowley, writing “Illegal in Massachusetts: Asking Your Salary in a Job Interview” for The New York Times, other states have also stepped up their equal-pay requirements. For example, in Maryland there’s a law mandating equal pay for “comparable” work. In California, there’s now a requirement that employers prove they pay workers of both genders equally for “substantially similar” jobs. Moreover, there are at least 12 other states that now let employees compare notes about how much they earn, Cowley reported.
In Massachusetts now, employers violating the new law will be liable to the employee for unpaid wages, including benefits and any other compensation, and for an added equal amount of liquidated damages. Moreover, action to recover can be brought against the employers in any court by any one or more employees for and on their own behalf, or on behalf of other employees similarly situated. As you might expect, the employer will have to pick up all legal fees, too.
Finally, forget about any agreement between the employer and the employee to accept a lower wage. The new law specifically declares that it shall not be a defense to a legal action.
Does it seem to get tougher every day to be a successful small-business owner?