New Pay Transparency Law For The Free State

Maryland has been the latest domino to fall in a surge of recent state and local wage transparency legislation across the United States. With at least eight states now requiring employers to post compensation ranges along with job advertisements—not to mention an increasing list of localities—employers of any scale are going to have to consider what seems increasingly inevitable: a hodgepodge of state and local laws that effectively create transparency requirements on a national scale.

The Maryland Senate and House just approved Bill 649 (“HB 649”) to expand the reach of Maryland’s Equal Pay for Equal Work Act. In previous posts (here and here), we outlined similar wage and pay transparency requirements under the NYC Pay Transparency Law and California’s laws governing pay transparency. Maryland’s HB 649, if signed by the governor, will require Maryland employers of any size to include salary ranges in job solicitations and advertisements. Along with New York and California, the Maryland bill joins similar passed or upcoming legislation in Colorado, Hawaii, Illinois, Washington, and Washington D.C.

Maryland Equal Pay for Equal Work Act

On October 1, 2020, Maryland adopted two amendments to its Equal Pay for Equal Work Act to include new wage transparency requirements for Maryland employers of any size. The first amendment required employers, at the request of job applicants, to provide a wage range for job openings, and prohibited employers from asking job applicants about their salary history. The second amendment prohibited employers from taking adverse employment actions against employees who asked about their own wages. Previously, the Maryland Equal Pay for Equal Work Act only prohibited adverse employment actions against employees who asked about the wages of their colleagues.

Maryland HB 649

On March 29, 2024, the Maryland Senate approved the most recent proposed amendment to the Maryland Equal Pay for Equal Work Act. If approved by the governor, HB 649 would require Maryland employers of any size to disclose the following information for all public or internal job postings for a covered position: (i) the wage range, (ii) a general description of benefits and (iii) a general description of any other compensation offered for the position. Alternatively, if a job posting was not made available to an applicant, a Maryland employer must disclose the required information to the applicant before a discussion of compensation is held or at any other time as required by the job applicant.

A wage range must be determined by the employer ​“in good faith,” and HB 649 instructs Maryland employers to reference previously determined pay rates for the position, pay rates of comparable positions and budgeted amounts when determining the wage range. Employers are also required to maintain a record of compliance with the wage transparency requirements for at least three years after the date that a position is filed or, if the position was not filled, the date the position was initially posted.

Most notably different about the Maryland bill compared to other state pay transparency laws, a covered position under HB 649 only applies to positions that will be physically performed, at least in part, in the state of Maryland. The law, therefore, excludes fully remote positions outside the state of Maryland from the pay transparency requirements.

Employers that violate BH 639 may be subject to letters compelling compliance from the Maryland Division of Labor and Industry for a first offense and fines up to $300-$600 for each employee or application for subsequent offenses.

If employers have questions about compliance with the Maryland pay transparency law, or any other state or local law requiring pay transparency for employees or applicants, now is the time to contact employment counsel. As always, Kelley Drye attorneys are available to answer questions and to assist with compliance.