Pay Equity Law Update

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New Connecticut Pay Equity Law

On May 22, 2018, Connecticut Gov. Dannel P. Malloy signed Public Act No. 18-8, “An Act Concerning Pay Equity,” into law. The new Connecticut law follows a recent trend by states to enact laws prohibiting employers from seeking salary history from prospective employees. Connecticut now joins California, Delaware, Massachusetts (see below), Oregon, and Vermont as one of six states having such laws, which are designed to remedy historic pay disparities between male and female employees.

The new Connecticut law, which goes into effect on January 1, 2019, includes the following protections for workers:

  • Employers may not ask applicants about their wage/compensation history at any point during the hiring process. That said, the new law does not prohibit applicants from volunteering to provide such information.
  • Employers may pose general questions to applicants about whether their previous employers offered or provided equity incentive or stock award programs, but questions as to the specific value of equity-related compensation are prohibited.

These protections are in addition to existing Connecticut law, which renders it unlawful for an employer to: (1) prohibit employees from discussing wages with one another, (2) require that employees sign a waiver designed to deny them the right to voluntarily disclose or discuss their wages with other employees, (3) discharge, discipline, discriminate, retaliate, or otherwise penalize employees who disclose their wage information to another employee, and (4) discharge, discipline, discriminate, retaliate, or otherwise penalize employees who inquire about the wages of another employee.

The new act also empowers applicants (whether hired or not) to sue a putative employer within two years after any alleged violation of the statute’s proscriptions concerning salary information and salary history. Employers found liable for violating the new law may be required to pay an aggrieved applicant compensatory damages, attorney’s fees, and punitive damages.

Update on Massachusetts Pay Equity Act

Several years ago, Massachusetts became the first state to enact legislation barring employers from asking job applicants about their salary history before making a formal job offer that includes compensation. As we noted in a previous post, the Massachusetts Pay Equity Act is set to go into effect on July 1, 2018.

This means that Massachusetts employers have less than a month to implement policies and practices designed to ensure compliance, such as:

  • Revising job applications, interview notes and related guidance to ensure that they do not include questions about salary history.
  • Training employees who are involved in recruitment and/or interviewing on the prohibitions outlined in the new law concerning salary history information sought during the interview process.
  • Modifying company policies that prohibit employees from discussing compensation with their coworkers to clarify that employees have a right to engage in such conversations.

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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