Massachusetts Becomes 11th State to Mandate Pay Transparency: What Staffing Agencies Need to Know

09 / 2024 | Laws and Regulations

 

HowAs the staffing industry evolves, Massachusetts has taken a significant step by enacting the Frances Perkins Workplace Equity Act, effective from July 31, 2025. This law marks Massachusetts as the 11th state to mandate pay transparency, presenting both challenges and opportunities for staffing agencies operating within or recruiting for the state. Here’s what you need to know:

 

Understanding the Law:

• Pay Range Disclosure: If your agency has 25 or more employees in Massachusetts, you must include the salary range in all job postings. This requirement extends to providing pay range information upon request to current employees or job applicants for any position.

 

• Annual Reporting: Agencies with 100 or more Massachusetts employees must submit annual Equal Employment Opportunity (EEO) and pay data to the Commonwealth, categorized by race, ethnicity, sex, and job category. This data will be aggregated and published annually.

 

• Promotion and Transfer Transparency: When offering a promotion or transfer to an employee, companies must provide the salary range for the new position before the employee accepts the role.

 

Impacts on Staffing Agencies

For staffing agencies, pay transparency mandates bring both challenges and opportunities. Here’s how you can stay ahead:

 

1. Compliance Is Key

Failure to comply with the pay transparency mandate can lead to penalties and lawsuits. Staffing agencies should start revising their job listings and recruitment materials now to reflect accurate salary ranges for each role.

• Tip: Review and audit your current pay structures to ensure salary ranges are clearly defined across all levels of employment. Ensure your recruiters are trained on how to communicate pay transparently and effectively with candidates.

 

2. Competitive Advantage

Pay transparency can be an asset when used strategically. Offering clear salary ranges upfront can help attract top talent, especially in a tight labor market. Job seekers are increasingly prioritizing pay transparency, and agencies that embrace this change early will have a competitive edge.

• Tip: Showcase your agency’s commitment to transparency in your job ads. This helps build trust with candidates and clients alike, and demonstrates that your agency is ahead of the curve in adapting to regulatory changes.

 

3. Impact on Client Relationships

For staffing agencies placing workers in Massachusetts, it’s critical to align with your clients on pay transparency. Many clients may be unaware of the upcoming law, so providing them with guidance on how to adjust will deepen your value as a strategic partner.

• Tip: Reach out to clients early to inform them about the new requirements. Help them understand how transparent salary ranges can benefit their talent acquisition efforts and protect them from non-compliance risks.

 

4. Wider Implications

Even if your agency isn’t based in Massachusetts, it’s worth paying attention to this trend. Pay transparency laws are sweeping across the country, and several other states are expected to introduce similar legislation soon. Agencies that prepare for pay transparency now will be better positioned to navigate future regulatory environments.

 

How Staffing Agencies Can Prepare

• Audit Pay Structures: Ensure your agency has clear, documented pay ranges for all roles. This will not only help with compliance but also streamline conversations with both candidates and clients.

 

• Train Recruiters: Equip your recruiting team with the knowledge and tools to have transparent conversations about pay. Pay transparency laws can be complex, and your recruiters should feel confident addressing any questions or concerns.

 

• Educate Clients: Your clients rely on you to keep them informed about labor laws and compliance issues. Hosting informational sessions or providing resources on the upcoming pay transparency requirements can help you deepen client relationships.

 

• Update Job Listings: Begin incorporating salary ranges into your job postings well before the July 31, 2025, deadline. Doing so will give you time to adjust your process and gather feedback.

 

 

StaffBoss Can Help

With StaffBoss, our clients can easily create job postings directly within the platform and, with the proper setup, seamlessly publish them to their websites. This integrated feature streamlines the recruitment process by eliminating the need for manual updates or third-party job boards. Once configured, job listings created in StaffBoss can automatically display on your website with the correct salary ranges and job details, ensuring compliance with pay transparency laws and maintaining consistency across all platforms. This not only saves time but also keeps your recruitment efforts organized and efficient.

 

Conclusion:

The staffing industry, which thrives on flexibility and rapid adaptation to market demands, finds itself increasingly under the microscope of regulatory changes. Massachusetts’ recent enactment of this pay transparency law exemplifies this trend. Such regulations aim to foster equity and transparency but also impose new operational challenges for staffing agencies. This law not only mandates how information must be presented to potential employees but also influences how agencies negotiate rates with clients, potentially standardizing pay scales across industries. The momentum behind pay transparency laws, as seen in Massachusetts and other states, suggests a growing legislative interest in regulating employment practices more stringently. This trend is likely to continue gaining traction, pushing the staffing industry towards more transparent, equitable, and possibly standardized compensation models, thereby reshaping how staffing agencies conduct business.

 

 

 

“Please note that while we strive to provide helpful information, it is important for you to stay up to date with the latest developments in Massachusetts pay transparency law. We may not communicate every update or change regarding the law, and we recommend consulting with legal counsel or official state resources to ensure full compliance with current regulations.”