Massachusetts Pay Clarity Act: What Employers Need to Know Before October 2025
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A landmark shift in workplace transparency is coming to Massachusetts, as a key component of the Massachusetts Pay Transparency Act takes effect on October 29, 2025. The new law will require many employers to disclose salary ranges for job postings, promotions, and upon request, fundamentally altering the landscape of compensation negotiation in the state.
Who is Affected by the New Law?
The disclosure requirements apply to any employer with 25 or more employees in Massachusetts. Determining employee headcount, however, isn’t as simple as a physical body count. According to the Massachusetts Attorney General’s office, which enforces the Act, an employee’s “primary place of work” is the deciding factor. This is defined as the state where the employee spends the majority of their working time.
For example, an employee dividing their time between Massachusetts (40%), Rhode Island (30%), and Connecticut (30%) would be counted towards the Massachusetts headcount. Crucially, this includes all employee types – full-time, part-time, seasonal, and temporary staff. Employers must calculate this average headcount annually, based on all payroll periods throughout the year.
Understanding the Disclosure Requirement
Beginning october 29, 2025, employers will be obligated to reveal the “pay range” for any “particular and specific employment position” in three key scenarios:
- In job advertisements or postings aimed at attracting applicants.
- When offering a promotion or transfer to a current employee involving different job responsibilities.
- Upon request,to either an employee currently in the position or an applicant for the position.
Notably, the definition of “applicant” is broad, encompassing anyone who applies for a job, irrespective of their qualifications. The Act extends to positions where the primary place of work is expected to be Massachusetts, including remote roles reporting to a Massachusetts location.
Defining the “Pay Range”
The “pay range” that must be disclosed represents the minimum and maximum salary or hourly rate an employer reasonably and in good faith believes it would pay for the position at the time of posting. if the role includes commission or piece-rate compensation,those rates must also be included in the disclosure.
Compliance and Potential Penalties
The Act provides employers with a “Notice to Cure” period to address any non-compliance issues before facing monetary penalties. Until October 29, 2027, employers will have two business days from receiving a Notice to Cure to rectify the situation.
Failure to comply within this timeframe will result in the following penalties:
- First offense: Warning
- Second offense: fine of up to $500
- Third offense: Fine of up to $1000
- Fourth or subsequent offense: Penalties outlined in General Laws Chapter 149, Section 27C, paragraphs (1) and (2) of subsection (b).
Additional Reporting Requirements: EEO-1 Reporting
Employers with 100 or more employees whose primary place of work is Massachusetts are also required to submit their EEO-1 report to the Massachusetts secretary of state by February 1 each year.
The Massachusetts Pay Transparency Act represents a notable step towards greater equity and openness in the state’s job market, and employers must proactively prepare for these changes to ensure compliance and avoid potential penalties.
