22 Aug Maryland Wage Transparency Law Takes Effect October 1, 2024
Beginning October 1, 2024, Maryland’s wage transparency law will take effect. Modeled off similar laws now in effect in other states, the Maryland law requires employers to disclose wage ranges and a general description of benefits in every public or internal job posting for positions performed, even partially, within the state. If no such posting is available, employers must provide this information to applicants before discussing compensation and upon request. The disclosed wage range must be set in good faith using real information (I have seen the meme that puts the wage range at $1.00 to $1.5 million or something like that). That kind of lunacy will not be tolerated.
Employers are prohibited from retaliating against applicants or employees for exercising their rights under this law, including requesting wage ranges or refusing to provide wage history. Since October 2020, it has been illegal for Employers to ask applicants for their salary history. An employer cannot rely on or seek applicants’ wage history to determine their pay, except when voluntarily provided after an initial offer to support a higher wage offer, provided it doesn’t result in an unlawful pay differential. This very limited exception should be approached very carefully and should involve discussions with legal counsel.
Suggested Outline for Preparing Wage Offer Structures
- Determine Position Requirements. Employers should have detailed job descriptions for each position and the necessary qualifications. This information is the baseline and to the greatest extent possible, should be written.
- Set Wage Ranges. Establish wage ranges in good faith based on market research, comparisons with similar employees performing similar work, and legal requirements.
- Develop Benefit and Compensation Descriptions. You do not have to have detailed descriptions of benefits, but broad categories, such as insurance and retirement benefit programs, bonuses, and other benefits must be described. For example, teachers at a boarding school whose housing is provided is a benefit that must be disclosed.
- Create Job Postings. Using the information from above, create the job posting. The state will produce a form that can be used to be compliant with this step. (The form is not yet available).
- Communicate with Applicants. Employers must provide wage and benefit information before any compensation discussions.
- Maintain Compliance. DO NOT INQUIRE ABOUT WAGE HISTORY DURING THE HIRING PROCESS.
- Documentation and Training. Keep records of job postings, the completed state forms, and job offers for at least three years after the person is hired, or if a position is not filled, for three years after the initial posting of the job. Ensure all hiring personnel are trained for compliance with these regulations.
We will keep you posted about the availability of the state form for wage range disclosures.
The state can enforce this law by fines of up to $600 per applicant. The Department of Labor can conduct audits and compel compliance. Plus, you have the uncomfortable aspect of having the Department of Labor in your business for quite some time.
Contact us to schedule a consultation to ensure your hiring process complies with this new law.