Beginning on October 1, 2024, employers are subject to new Wage Range Transparency and Pay Stub and Pay Statement laws. The Maryland Department of Labor has released guidance materials to help employers navigate these new requirements.
Wage Range Transparency
From MDOL
- Wage Range Transparency FAQs
- Narrative Examples
- Compensation Disclosure Form (PDF)
- Compensation Disclosure Form Instructions (PDF)
Posting Requirements
Currently, Maryland law requires employers to provide the wage range for a position only if requested by an applicant. As further explained by the Department of Labor in its recent guidance, under the new Wage Range Transparency law, employers are required to include the wage range, a general description of benefits, and any other applicable compensation in internal and external job postings. If the posting is not available to the applicant prior to the filing of their application, it must be provided to the applicant before any discussion of compensation takes place with the applicant and at any other time the applicant requests.
An employer's "wage range" must include the minimum and maximum salary or hourly rate for compensation for the job, promotion, or transfer opportunity that the employer in good faith believes to be accurate at the time of posting. This may be any applicable pay scale, any previously determined range of wages for the position, the actual range of pay for current employees holding comparable positions, or the amount budgeted by the employer for the position. If an employer offers a fixed rate of pay, the employer must include the fixed rate in the posting.
The "general description of benefits" required to be provided in job postings includes employer-provided insurance, paid or unpaid time off work, retirement or savings funds or employer-funded pension plans, or other forms of compensation such as the value of employer-provided meals or lodging. The "any other compensation offered" required to be provided includes any other earnings or monetary compensation that an employee may receive as payment in return for work performed including but not limited to overtime, compensatory time, differentials, premium pay, tips, commissions, bonuses, stock or stock options, and any portion of service charges.
To aid employers in satisfying the requirements of the Wage Range Transparency law, the Commissioner of Labor has created a template employers may use which will satisfy the employer's legal obligation to provide the required disclosures (see links above). Examples of other acceptable formats are also available.
Employers should note that an advertised range of pay must be for a single position in a single location. If a posting involves multiple locations or opportunities at different levels of seniority, a separate range of pay must be posted for each location or opportunity.
Applicability
The Wage Range Transparency law applies to newspaper advertisements and printed flyers, social media posts, emails sent to more than one applicant or sent through an electronic mailing list, advertisements published through any other medium, and postings done on behalf of the employer. Any position where work will be physically performed, at least in part, in Maryland is covered by this law. However, positions where an employee only occasionally works in the state (for example, attending meetings and conferences or communicating with Maryland-based employees) are not covered.
The law also applies to the reposting of a position. The employer may change the terms of the position in the posting if made in good faith.
Pay Stubs and Pay Statements
From MDOL
Notices at Hiring
At the time of hire, employers are currently required to provide notice of certain information related to rate of pay, paydays, and leave benefits, and a statement of the gross earnings of the employee and deductions from those gross earnings for each pay period.
Effective October 1, 2024, the Pay Stub and Pay Statement law now requires employers to provide these notices of rates of pay, paydays, and leave benefits in writing. The Maryland Department of Labor has provided some additional information.
Pay Statement Requirements
The Pay Stub and Pay Statement law requires that employers provide employees with a written or online pay statement each payday. These statements must include certain information: the employer's name, address, and telephone number, date of payment, dates of the pay period, number of hours worked during the pay period (unless the employee is exempt from federal and State overtime requirements), all rates of pay, all additional bases and amounts of pay (bonuses, commissions, etc.), applicable piece rates of pay and the number of pieces completed at each piece rate, gross and net pay earned during the pay period, and the amount and description of each deduction made from pay.
These requirements cannot be waived by the employee. Restaurant employers should note that this law includes additional requirements that are not required to be part of the tip credit wage statements required by Maryland law.
To aid employers in satisfying the requirements of the law, the Commissioner of Labor and Industry has created a paystub template employers may use which will satisfy the employer's obligation to provide the information required.
Employers must provide notice of any decrease in an employee's rate of wage at least one pay period in advance. Wages may be increased without advance notice.
Penalties
The bottom line is that if you use accurate information on the MDOL Forms you will be in compliance with these laws. Individual employees do not have the authority to sue under these laws, but the Commissioner of Labor may order employers to comply and impose penalties (ie $500 per employee who did not receive the required notice or information for the Wage Transparency obligation.
Takeaways
Employers should review and update their onboarding procedures and paystubs to include the information required by these laws, ensuring compliance by the October 1, 2024 deadline. We also recommended that employers notify and train HR and payroll staff on the new requirements. Employers should also ensure job postings meet all necessary obligations under the Wage Range Transparency.
We understand these guidance materials may be overwhelming, so please do not hesitate to reach out with any questions.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.