2025 is already proving to be an eventful year for Massachusetts employers, and it is only February!  Below are the highlights of the new Massachusetts pay transparency law, and a few family and medical leave developments you may have missed. 

Pay Transparency Law Kicks Into Gear

After enacting the Equal Pay Act in 2018, Massachusetts has joined a growing list of states adopting pay transparency laws, in a continued effort to achieve better pay equity and close the gender and racial wage gap.

Effective October 29, 2025, employers with 25 or more employees in Massachusetts will be required to disclose the pay range for a position in all job postings.  Under the law, “pay range” is defined as the annual salary or hourly wage range the employer “reasonably and in good faith expects to pay” for the position at that time.  Therefore, Massachusetts law differs from the law of other states, such as Colorado and Illinois, which require that job postings include additional information, such as a general description of benefits and/or other forms of compensation such as bonuses, commissions, equity or retirement benefits, as we had previously reported. 

The law will also require employers to provide pay range information to (1) employees who are offered a promotion or transfer to another position, and (2) an employee in or applicant for a particular position, who requests pay range information for such position. The law also prohibits retaliation against an employee for enforcing their rights under the law or making a complaint or participating in a proceeding related to an alleged violation of the statute.

Additionally, Massachusetts employers with 100 or more employees must submit an annual equal employment opportunity (“EEO-1”) report containing wage data and other demographic information for their workforce, categorized by race, ethnicity, sex and job category. Reports are due with the Secretary of State’s Office annually by February 1.  For 2025, this report was due by February 3, 2025 (the first business day after February 1, 2025).  Employers who missed this deadline should consult with employment counsel to determine whether to file their report late or wait until 2026.

Different reporting requirements apply to unions, state and local governments, and public elementary and secondary schools. For more information or to file an EEO report, visit the Secretary of State website at: https://www.sec.state.ma.us/divisions/corporations/eeo-data-reports.htm 

The Secretary of State will publish aggregate wage data through the Labor and Workforce Development.  However, wage data reports submitted with the Secretary of State are not considered “public records” and therefore not subject to public record requests.  

The Attorney General has exclusive jurisdiction to enforce the wage disclosure requirements; therefore, there is no private right of action for failure to submit a wage report or publish pay range information.  However, an employee who has been retaliated against for requesting pay range information may file a private right of action. Violations of the law will not expose the employer to treble damages under the Wage Act.

Paid Family and Medical Leave Updates

Employers should review their policies and procedures to make sure that they reflect with recent developments with respect to paid family and medical leave rights of Massachusetts employees. 

Earned Sick Time: Last year, Governor Healey signed a law expanding the qualifying uses of earned sick leave.  Massachusetts employees may now use earned sick time to “address the employee’s own physical and mental health needs, and those of their spouse, if the employee or the employee’s spouse experiences pregnancy loss or a failed assisted reproduction, adoption or surrogacy.”  

Paid Family and Medical Leave: Effective January 1, 2025, the maximum weekly PFML benefit amount increased slightly to $1,170.64. The contribution rates remain the same. 

In September 2024, the Massachusetts Supreme Judicial Court in Bodge et al. v. Commonwealth, 494 Mass. 623 (2024) clarified that the PFML does not require that employees be allowed to continue accruing employment benefits, such as paid vacation, sick time, and service credit, while on PFML.  The decision confirmed that PFML leave only requires that employees not lose previously-accrued benefits before their leave began, but does not require continued accrual of benefits.  Of course, employers may allow employees to continue accruing benefits while out on PFML, if they wish. Employers are also required to continue existing health insurance benefits while the employee remains on PFML.

IRS Guidance:  On January 15, 2025, the federal Internal Revenue Service issued long-awaited guidance with respect to the taxation of PFML contributions and benefits. Among other things, the guidance clarifies that employer PFML contributions are considered a state excise tax and deductible as business expenses.  Employees can also deduct their contributions if they itemize deductions (up to a cap set by federal law).  Employee contributions paid by the employer are taxable to the employee as income, and subject to employment taxes. PFML benefits paid to employees receive may receive different tax treatment depending on whether the leave was “family leave” or “medical leave.”  The full guidance is available here. 

If they have not done so already, Massachusetts employers should review and update their policies and payroll systems consistent with the above changes and clarifications. 

As a reminder, the PFML poster, model employee notices, and rate sheets are available here.  

Questions

If you have any questions, please contact a member of Casner & Edwards' Employment Law practice.