A new law, An Act Relative to Salary Range Transparency (the “Act”), which includes requirements designed to enhance pay transparency in Massachusetts goes into effect soon. The Act includes two primary components: (1) a pay range disclosure requirement; and (2) a pay data reporting requirement.
Massachusetts employers should be prepared to comply with the requirements of this law, as the requirements will become effective in 2025, including certain reporting requirements as early as February 1, 2025.
Pay Range Disclosure Requirement
The Act will require private and public employers with 25 or more employees to include the “Pay Range” in all job advertisements, disclose these ranges when an employee is promoted or transferred, and provide the information upon request to employees and applicants. The term “Pay Range” is defined 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 the time.” Notably, this definition does not appear to include other forms of compensation, such as bonuses or commissions. This provision will take effect on October 29, 2025.
Pay Data Reporting Requirement
The Act will require private employers with 100 or more employees to submit annual demographic and pay data, by submitting a copy of their EEO-1 data report (including demographic and pay data categorized by race, ethnicity, sex and job category) for the prior year to the Secretary of the Commonwealth by February 1 of each year. Employers of this size are likely already familiar with the EEO-1 data report, which is required by the U.S. Equal Employment Opportunity Commission (EEOC). That report must now be submitted to the Massachusetts Secretary of the Commonwealth as well. The first round of data for covered private employers is due by February 1, 2025.
Unions, state and local governments, and elementary and secondary schools with the requisite employee count, will be subject to similar reporting obligations on a bi-annual basis.
The aggregate data from these reports is to be published on the Massachusetts Department of Labor website. However, the Act provides that individual employer wage data reports “shall not be considered ‘public records.’”
Prohibition Against Retaliation and Discrimination
The law prohibits retaliatory or discriminatory actions by employers against employees or applicants who assert their rights under the Act, including those who file complaints or participate in legal proceedings related to alleged violations.
Enforcement Mechanism
With the exception of the section prohibiting retaliation and discrimination, enforcement of the Act is solely vested in the Massachusetts Attorney General. The Attorney General is authorized to seek remedies, including injunctive relief and civil penalties for non-compliance. Significantly, a first offense will result in only a warning, while subsequent offenses will incur increasing severe fines ranging from no more than $500 for a second offense, no more than $1,000 for a third offense, and up to $25,000 for a fourth or subsequent offense.
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Given the upcoming effective dates for this law, we recommend employers start preparing now and consider taking the following steps:
- Confirm and/or establish pay ranges for all positions;
- Ensure required pay ranges will be included in all job postings, as of October 29, 2025;
- Assess whether changes in pay are needed to ensure equity among employees;
- Advise managers and relevant personnel so they are aware of the pay disclosure requirements of the Act and the prohibition against retaliation and discrimination;
- Prepare to timely submit required reports to the Secretary of the Commonwealth; and
- For employers operating in multiple states, consider aligning pay transparency practices to streamline compliance efforts.
The pay transparency law is intended to enhance wage equity and transparency in the workplace and job market. This is a laudable goal and hopefully it will be achieved. Either way, Massachusetts employers need to prepare to comply with the new and imminently effective requirements of this law.