Complying With Maryland’s Pay Transparency Laws
It is in the best interest of employees for employers to be transparent about how much they pay employees in a certain role. Most companies fall far short of the ideal of paying the same salary to all employees who perform the same duties, and there are often justifiable reasons for this, but employers should be honest with employees about the discrepancies in pay for comparable work and about the reasons underlying these discrepancies. For example, most companies could not afford to pay a new employee a starting salary equal to the salary of an employee who has been working for the company for 20 years and accumulating annual raises. Recent laws acknowledge, however, that it is unfair for companies to ask job applicants to disclose their salary history while the company does not have to tell applicants how much it pays its current employees for the job; this practice facilitates employers offering jobs to the lowest bidder. Maryland law protects employees from the risk of employers basing salary decisions on the applicant’s salary history instead of on the going rate for the job. A Washington DC small business lawyer can help your company comply with the laws regarding pay transparency.
Legal Requirements for Pay Transparency
According to Maryland law, employers are not allowed to ask job applicants about their salary history. The employer must determine the amount to offer before reviewing applications. The law does not require employers to list salary ranges in job postings, but if applicants ask about the salary range before or after receiving a job offer, the employer must provide it.
Preparing for Uncomfortable Questions About Fair Pay in Your Organization
Before prospective employees start asking you about salary ranges, you should ask yourself whether your company pays its employees fairly and whether a prospective employee would still want to accept a job offer from you if you told her the real reason for the discrepancy in pay between two employees with identical work tasks. This may mean that one or more of your current employees is due for a raise. It looks especially bad if pay discrepancies within your organization divide neatly along racial or gender lines or if family members of the company owner get paid more than employees whose relationship to the owner is purely professional.
Before you advertise open positions within your company, consider, on a purely financial basis, how much you can afford to pay new employees. It is much easier to think clearly about this if you discuss your company’s overall financial situation with a business law attorney. Your lawyer can also help you strategize about how to answer job applicants’ questions about salary ranges truthfully but diplomatically.
Let Us Help You Today
A business law attorney can help you strategize about how much money to offer new employees before you publish the job listing and how to comply with pay transparency laws. Contact Tobin, O’Connor & Ewing for help today.