On October 1, 2024, Maryland's new pay transparency law  effect, bringing significant changes to how employers advertise job openings and disclose compensation information.

This law expands on Maryland's existing Equal Pay for Equal Work Act and aligns the state with a growing national trend towards greater wage transparency.

Key Requirements

Under the new law, Maryland employers must include the following information in all public and internal job postings:

1. Wage range (minimum and maximum salary or hourly rate)
2. General description of benefits
3. Any other compensation offered for the position

These requirements apply to all positions that will be physically performed, at least in part, in Maryland.

This includes remote work positions for Maryland-based employees, even if the employer is headquartered elsewhere.

Covered Employers

The law applies to all employers "engaged in a business, industry, profession, trade, or other enterprise" in Maryland, regardless of size.

This includes both public and private employers, as well as third-party recruiters acting on behalf of employers.

Wage Range Determination

Employers must set wage ranges in good faith, based on one of the following:

1. Any applicable pay scale
2. Previously determined minimum and maximum wages for the position
3. Wage range for comparable positions
4. Budgeted amount for the position

Additional Provisions

1. If no job posting is made, employers must provide the required information to applicants before discussing compensation and upon request.
2. Employers must maintain records demonstrating compliance for at least three years after a position is filled or from the date of initial posting if unfilled.
3. The law prohibits retaliation against employees or applicants who exercise their rights under the law, such as requesting wage range information.

Enforcement and Penalties

The Maryland Department of Labor will enforce the law. Penalties for violations include:

• First violation: Order to comply
• Second violation: Civil penalty up to $300 per affected employee/applicant
• Subsequent violations: Civil penalty up to $600 per affected employee/applicant

Existing Salary History Restrictions

Maryland's existing law already prohibits employers from:

1. Relying on an applicant's wage history for screening or determining wages
2. Seeking an applicant's wage history
3. Retaliating against applicants who don't provide wage history

Employers may only use voluntarily disclosed wage history to support a higher wage offer after making an initial offer of employment with compensation.

Preparing for Compliance

To prepare for the October 1, 2024, effective date, Maryland employers should:

1. Review and update all job posting processes and templates
2. Establish a system for determining good-faith wage ranges
3. Train hiring managers and recruiters on the new requirements
4. Update record keeping practices to maintain compliance documentation
5. Consider conducting a pay equity audit to ensure fair compensation practices

Broader Context

Maryland joins several other states and jurisdictions with similar pay transparency laws.This trend reflects growing efforts to address pay inequities and promote fair compensation practices.

The Maryland Department of Labor is expected to release additional guidance and a model disclosure form that employers can use to comply with the new requirements. Employers should monitor for these updates and adjust their practices accordingly.

In conclusion, Maryland's new pay transparency law represents a significant shift in how employers must approach job advertising and compensation disclosure. By proactively preparing for these changes, employers can ensure compliance and contribute to a more transparent and equitable job market in Maryland.