On May 19, 2016, Maryland governor Larry Hogan signed the Equal Pay for Equal Work Act of 2016, which significantly expands from the previous Equal Pay Act that had mostly stuck to the federal standard. The new Equal Pay Act has some significant takeaways that employers need to take into consideration after the new Act takes effect October 1, 2016.
The current, until October, Act prohibits employers from discriminating “between employees in any occupation by paying a wage to employees of one sex at a rate less than the rate paid to employees of the opposite sex if both employees work in the same establishment and perform work of comparable character or work on the same operation, in the same business, or of the same type.”
The new Act not only looks at the differential in wages based on sex, but on the grounds of gender identity as well. Further, the 2016 Act goes beyond just the wage or pay scale, but also prohibits employers from providing “less favorable employment opportunities” based on sex or gender identity. The term “employment opportunity” is defined rather broadly, but basicly does not allow for an employer to negatively influence an employee’s career trajectory on the basis of sex or gender identity. (i.e. career track, promotions, advancement, etc.)
Another aspect that the 2016 Act wants to ensure is protected is the employee’s right to discuss his/her wage or salary without fear of punishment by the employer. Employers cannot prohibit any employee (i) from inquiring about, discussing, or disclosing the employee’s wages with the wages of another employee; (ii) from requesting that the employer provide a reason for why the employee’s wage are a condition of employment; and (iii) from aiding or encouraging another employee’s exercise of rights under the new Act. Employers cannot get an employee to agree to waive these rights, nor can they take adverse action against the employee for disclosing such information.
The 2016 Act also allows for injunctive relief, attorney’s fees, and liquidated damages for actions brought up within the statute of limitations period of three years, that begin after the employee receives from the employer wages upon the conclusion of employment.
So what does this all mean for employees and employers? Maryland is taking the lead of the federal government on working towards equal pay based on sex and gender identity, and going one step further. Maryland does not want an employer to be able to hide and block the discussion on wages and pay for its employees. The employees have the right to discuss and talk about their salary and wages with their fellow employees should they feel the desire to do so. Employees should become aware of these new policies, and employers should revisit their business policies and management practices to ensure their business is compliant with the new Equal Pay for Equal Work Act of 2016.
Hopefully, the new Act of 2016 will be a step towards minimizing the wage gap that exists between the different sexes and gender identities.