On July 1, 2018, the new Equal Pay Law, as well as the new Workers’ Compensation Rates, will go into effect in Massachusetts. The following is a refresher about each of these items as well as links to the in-depth article on each topic.
The New Equal Pay Law Goes Into Effect on Sunday
Way back in August of 2016, Governor Baker signed a new equal pay law entitled “An Act to Establish Pay Equity.” The new equal pay law replaces a less stringent equal pay law originally passed in 1945. The new statute prohibits discrimination “in any way on the basis of gender in the payment of wages.” Also, the new equal pay law gives workers the right to bring direct actions against employers for gender-based wage discrimination and restricts the rights of employers to ask job applicants for salary history.
The new equal pay law will now officially go into effect on July 1, 2018, and will require employers in the Commonwealth to carefully review their hiring and compensation practices.
As for insurance producers, the new equal pay law will provide a marketing opportunity if insurance carriers respond to the new law by offering employment practice liability insurance (“EPLI”) that will cover the new law’s risks. The right provided by the new equal pay law allowing employees to file lawsuits directly against their employers for themselves and other similarly situated employees should act as a powerful inducement for employers to purchase or augment EPLI coverage.
To read an in-depth analysis of the new law, please refer to our April 2018 article entitled, “Ten Points About The Massachusetts Equal Pay Law Taking Effect July 1, 2018.“
New Workers’ Compensation Rates Also Go Into Effect
In addition to the new Equal Pay Law, workers’ compensation rates in Massachusetts also will be decreasing as of July 1st, 2018.
On December 22, 2017, the Workers’ Compensation Rating and Inspection Bureau of Massachusetts (“WCRIB”) submitted a rate filing seeking a statewide average decrease in workers’ compensation rates of 11.1 percent effective July 1, 2018.
This latest rate filing came a year after the last time the WCRIBMA submitted a rate filing to the Division which unlike the present rate filing, sought a rate increase.
On March 15th, a written stipulation by all of the interested parties was submitted to the Division which stated that all of the interested parties had agreed to an overall average 12.9% decrease in existing workers’ compensation rates, effective for all new and renewed policies on or after July 1, 2018.
For these readers interested in reading about the rate change, please refer to Agency Checklists’ March 27, 2018 report which includes all of the rate changes since 1988 entitled, “Division Approves Average Rate Rollback of 12.9 percent On Mass. Workers’ Compensation Rates.”