Employer's Guide to New Pay Transparency Regulations in Minnesota and Maryland

Starting in late 2024 and early 2025, Minnesota and Maryland will implement new pay transparency laws requiring employers to include detailed compensation information in job postings. These laws are part of a growing trend aimed at promoting wage transparency and preventing wage discrimination. Here's a breakdown of what employers in these states need to know to ensure compliance.

Maryland's Wage Transparency Law

Starting October 1, 2024, Maryland's new wage transparency law (SB 525/HB 649) will require all public and private employers to include detailed compensation information in all job postings. The law covers job positions performed at least partially in Maryland, including remote and hybrid roles.

Job postings must include:

Wage Range: Minimum and maximum hourly or salary wage, determined in good faith.
Benefits and Other Compensation: A general description of benefits and any other compensation (e.g. bonuses, commissions).

If no job posting is made, employers must disclose this information before discussing compensation with the applicant and upon the applicant's request.

Record Keeping: Maintain records of wages, job classifications, and other employment conditions for three years after a position is filled or the job posting is made if the position remains unfilled.

Enforcement and Penalties:

First Violation: Compliance letter from the Maryland Department of Labor. 
Second Violation: Civil penalty up to $300 per affected employee or applicant.
Subsequent Violations: Up to $600 per affected employee or applicant within three years of a prior violation

Minnesota's Pay Transparency Law

Effective January 1, 2025, employers with at least 30 employees at one or more sites in Minnesota must adhere to these requirements to ensure compliance with the newly established Minnesota Statutes section 181.173. This includes a broad spectrum of employers such as individuals, nonprofits, groups of persons, governmental subdivisions, corporations, and partnerships.

Job Posting Must Include

Starting Salary Range: Minimum and maximum annual salary or hourly range based on a good faith estimate.
Benefits and Other Compensation: A general description of all benefits and other compensation, including health and retirement benefits.
Scope: Applies to all job postings, whether posted electronically or in hard copy, and includes postings by third-party recruiters.

State pay transparency laws are becoming increasingly prevalent. Maryland and Minnesota join at least 15 other similar state and local pay transparency or pay equity laws. Fourteen states have also proposed similar legislations. 

Employers in both states should take the following proactive steps to align with these new regulations: 

•  Review compensation policies to ensure wage rates are set consistently and equitably.

•  Update job posting practice to include required wage and benefits information in all job postings.

•  Educate HR teams and hiring managers on the new laws and the importance   of wage range disclosure.

•  Adjust HR systems to automatically include required compensation information in job postings.

•  Maintain detailed records to keep thorough records of wages and employment conditions for at least three years.

By adhering to these new pay transparency laws, employers in Minnesota and Maryland can promote fair pay practices and build greater trust with their employees and job applicants. OutSolve experts can assist your organization proactively planning for these changes. Contact us today.