Massachusetts Provides Clarity on New Pay Transparency Law

Quick Hits

• Massachusetts’s pay transparency law, effective October 29, 2025, requires employers to disclose salary ranges to job applicants and current employees, which the state legislature hopes will promote workplace fairness and equity.
• The law mandates that employers with twenty-five or more employees in Massachusetts must include salary ranges in all job postings and provide this information upon request or during hiring, promotion, or transfer processes.
• Employers may want to review and update their compensation practices, ensure pay equity, and train HR and management to comply with the new pay transparency law requirements.

Key Provisions of the Pay Transparency Law

The Massachusetts pay transparency law mandates that “covered employers” (defined as employers with twenty-five or more employees (whether full-time or part-time) whose primary place of employment is in Massachusetts must disclose the salary range for a position to job applicants and current employees. Here are the key provisions:

• Salary Range Disclosure: Employers are required to provide the salary range for a position to job applicants upon request, to current employees upon hire, promotion, or transfer, and in any job postings.
• “Salary Range” Defined: The statute defines salary range as the “annual salary range or hourly pay range the employer “reasonably and in good faith” expects to pay for the specific position “at that time.”
• Job Postings: All job postings must include the salary range for the position. This applies to both internal and external job postings, whether directly by the employer or through a recruiting firm or agency.
• Nonretaliation: The statute contains a broad anti-retaliation provision which provides that employers are prohibited from retaliating against employees who take any action to enforce their rights under the statute.
• Enforcement: The statute provides a wide range of penalties (enforced by the Massachusetts attorney general), starting with a warning for a first offense, a fine of up to $500 for a second offense, a fine of up to $1,000 for a third offense, and a fourth or subsequent offenses are subject to the more draconian provisions of MGL c. 149, s. 27C (subsections b (1) and b (2), which can carry civil penalties of up to $25,000). However, for the first two years following the effective date of the statute (until October 29, 2027), employers will have two business days to cure any defects upon receipt of a notice to cure letter from the Attorney General’s Office.

FAQs Posted in July 2025

In July 2025, the Massachusetts Department of Labor Standards (DLS) posted guidance in the form of frequently asked questions (FAQs) to guide employers in complying with the pay transparency law. Here are some of the key points from the posting:

• Defining Salary Ranges: The guidance clarifies that salary ranges must reflect the actual compensation that the employer reasonably expects to pay for the position. Employers cannot provide overly broad ranges that do not accurately represent the pay for the role.
• Commissions/Tips and Piece Rates Included: According to the DLS, although the statute makes no mention of other forms of compensation, when an employee’s pay includes tips, commissions, or piece rates, then information related to anticipated commission pay, piece rates, and/or tip income needs to be disclosed as well
• Transparency in Promotions and Transfers: Employers must disclose the salary range for a new position to current employees when they are being considered for a promotion or transfer. This disclosure must occur before the employee accepts the new role.
• Application to Remote Work: The posting obligation applies to positions that can be performed remotely and that report to a Massachusetts worksite, as well as remote workers with a primary place of work in Massachusetts.

What This Means for Employers

The pay transparency law represents a significant shift in how compensation information is managed and disclosed in Massachusetts, and brings Massachusetts employers in line with a growing number of other states that have enacted similar pay transparency laws. Employers can consider taking proactive steps to ensure compliance with the new requirements:

• Reviewing and Updating Compensation Practices: Employers may want to evaluate current compensation structures, and ensure that salary ranges are clearly defined and documented.
• Ensuring Pay Equity Has Been Reviewed: With transparency in postings and upon request, it is critical that employers are paying employees commensurately and fairly. Otherwise, postings may reveal discrepancies to incumbents that may be difficult to defend.
• Ensuring That Defensible Wage Influencing Factors Used: The Massachusetts Equal Pay Act only includes six factors that may justify a pay disparity and does not include the federal defense of any “bona fide factor other than sex.” As such, employers may want to make sure their decisions are based on those factors and not ones that federal law arguably would allow (for example, market forces or negotiation).
• Updating Job Postings: Consider ensuring that all job postings, both internal and external (whether issued by the employer or a hiring agency), include the required salary range information.
• Training HR and Management: Training HR personnel and managers on the new requirements and best practices for compliance will help prepare for compliance with the new requirements.
• Maintaining Records: Implementing a system for maintaining records of salary ranges and the rationale for determining those ranges will also be key to complying with the pay transparency law.

Conclusion

The Massachusetts pay transparency law is designed to promote fairness and equity in the workplace by ensuring that employees have access to important compensation information. By taking proactive steps to comply with the new requirements, employers can foster a more transparent and equitable work environment, and avoid potential liability in the process.

Ogletree Deakins’ Boston office and Pay Equity Practice Group will continue to monitor developments and will post updates on the Massachusetts and Pay Equity blogs as additional information becomes available.

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