New law includes a salary history ban and pay transparency and goes into effect January 1, 2023

The new law, signed by Governor Dan McKee and effective on January 1, 2023, makes it unlawful to pay an employee less than the employees of another race, color, religion, sex, sexual orientation, gender identity or expression, disability, age, or country of ancestral origin for comparable work.

The law is consistent with other state pay equity trends and contains a ban on employer inquiries about or reliance on salary history. It also includes pay transparency protections and employers may not require a candidate to disclose salary history or rely on salary history on a candidate to defend lower pay. Employees may openly discuss pay without fear of reprisal.

The good news for employers is that it provides a “safe harbor” by providing an affirmative defense to all liability if they can demonstrate that they have analyzed pay and worked to fix identified discrepancies. This evaluation of pay practices must have been conducted within two years of the commencement of an action and the employer must be able to prove that the pay differences identified in the analysis have been eliminated.

OutSolve’s Take

Rhode Island joins Massachusetts, New Jersey, New York, Illinois and California in updating state equal pay laws to expand their reach. Rhode Island’s law defines comparable work as work involving substantially similar skill, effort, responsibility, performed under similar working conditions. As noted above, prior pay cannot be used to establish pay rates, nor can employees be punished for discussing pay rates.

The Director of Rhode Island’s Department of Labor and Training is responsible for enforcing the law. Under the “safe harbor” provisions, an employer's pay analysis may be of their own design or on a standard template or form to be issued by the Department of Labor and Training, so we may expect this to be accomplished before the law takes effect.

Not only is pay equity a focus for the Biden Administration, but for a growing number of states as well. For clients who wish to take preventive measures to evaluate their pay practices, OutSolve’s Pay Equity Analysis Services are available. Additional information on OutSolve’s Pay Equity Analysis or other compliance services may be obtained at info@outsolve.com or by calling 888-414-2410.