In a 158-0 vote, the Massachusetts House of Representatives voted to approve the so-called Pay Equity Act. The Act makes it unlawful for any employer to discriminate “in any way on the basis of gender in the payment of wages,” or to pay someone of a different gender less for comparable work. The term “comparable work” is defined as work which requires substantially similar “skill, effort and responsibility,” and is performed under similar working conditions. These somewhat fuzzy concepts may present substantial liabilities to the unwary employer.
An employer who is non-compliant must pay the employee the unpaid wage differential, as well as an additional amount equal to the unpaid wages – in essence, double damages measured by the amount of unpaid wages for comparable work. The aggrieved employee can sue in Superior Court, and the court may award a prevailing employee his costs and attorneys’ fees. The Act also expressly contemplates class actions. Any agreement to pay employees less than that to which they are entitled under the Act is not a defense to liability.
The Act does allow for wage variations if based upon the following factors:
- a merit system
- earnings measured by quantity/quality of production, sales or revenue
- geographic location
- education, training or experience if related to a particular job
- travel if regular and necessary.
Of course, if the wage payment is challenged in court, the employer would have to prove that the pay differential was the result of one or more of these factors.
The Act also prohibits an employer generally from requiring a prospective employee to refrain from inquiring about or disclosing the employee’s own wages or that of another employee. The Act also allows for an affirmative defense to liability if the employer has completed a self-evaluation of its pay practices, and has made reasonable progress in eliminating wage differentials based upon gender.
Given the momentum on Beacon Hill for this Act, there is a very good chance it will become law. Employers will need to review their pay policies and any variations to ensure compliance.