Great Strides for Pay Equity – First in Massachusetts
I am a transplant to Massachusetts, but I’ve now lived here longer than anywhere else in my life. Despite not being a native, there is a lot I can be proud of as a resident of Massachusetts, including a lot of important firsts. The Boston Common was the first public park in America. The first free American public school was founded in Dorchester in 1639. The first public library, the first battle of the revolution, the first basketball game, the first subway (the transportation, not the sandwich), all happened in Massachusetts. In 2003 we became the first state to legalize gay marriage. And on August 1, 2016 Massachusetts signed into law a first of its kind piece of legislation broadening the definition of equal work, and creating a platform for true pay equity.
Massachusetts is not the first state to tackle the pay equity issues through legislation, but what is unique about the bill signed by Gov. Charlie Baker is that it now makes asking an applicant for information about their prior salary illegal. It requires that companies base their compensation offers on the value of the skills and the work, and not on some formula applied to an individual’s previous salary. This is exactly the kind of thinking I wrote about recently in response to a study looking at college graduate compensation. To truly be equitable everyone should be paid on the market value of their skills, as well as their level of proficiency with those skills.
While this is a great stride forward, the change will not be easy. There will surely be legal wrangling on the wording that is acceptable in salary negotiations. And recruiters and hiring managers will have to be trained on new practices. But more fundamentally, we’re going to have to be ok with world in which “fair” and “equitable” have to coexist. Someone with decades more experience in a certain skill may not be as productive as a less experienced candidate. As organizations and individuals, we need to be prepared to make tough decisions about what that means for their compensation, and teach managers how to communicate those decisions.
This is a shift far beyond legislation. But I also believe it’s a shift we have to make to move toward the future of work, and a networked, “gig” economy workforce. In a freelance nation, from task to task, client to client, skill to skill, an individual may have different pay rates. It will be incumbent on individuals to continue to upskill and evolve their capabilities to remain competitive. It will be a very different world than the paternalistic view of working for 40 years and retiring with a gold watch. Or even from moving from company to company every 3-5 years with steadily growing income and 401(k) balances.
I fundamentally believe this change is good for pay equity. But it will be hard to shift decades of mindset around how careers progress and how we value the work people do. But we like hard work in New England. And I hope we do look back with pride and say this was an important first in creating true pay equity and evolving the modern workforce. And I hope someday the idea of the first pay equity laws become as quaint as the thought of the first fluffernutter sandwich – also from Massachusetts.