Employers take note! The Maryland General Assembly’s 2024 session resulted in new laws aimed at increasing transparency for both current and prospective employees regarding employee wages.

These new laws require employers to provide more detailed information to prospective employees about how much an open position may pay, and to provide current employees a more detailed breakdown of how employers are calculating their pay. These pay transparency laws become effective on October 1, 2024, and employers should take steps to familiarize themselves with these laws to ensure that their current recruiting and payment practices comply with new legal requirements.

The Maryland Wage Transparency Law

The Maryland Wage Transparency Law requires employers, both public and private, to disclose in any public or internal job posting the “wage range” for an open position, as well as provide a general description of any other benefits or offered compensation.  A job “posting” is broadly defined as any “solicitation intended to recruit applicants for a specific available position,” and covers efforts made directly by an employer as well as any acts by third parties that employers may use to recruit new employees.

The new law requires employers to estimate the potential wage range, which could be either a salary or hourly rate, in “good faith” using any of the following: any applicable pay scale, any previously determined minimum and maximum hourly rate or salary for the position, the minimum and maximum hourly rate or salary of an individual holding a comparable position at the time of posting, or the budget amount for the position.

The Wage Transparency Law applies only to positions in which the employee will physically perform work, at least in part, in the state of Maryland. So job postings for positions where employees will perform work exclusively out-of-state are exempt. However, for job postings that are covered by the Wage Transparency Law, employers are required to keep a record showing that a covered job posting complied with the law for three years after the position was filled, or three years after the position was posted if the position goes unfilled.

To ensure compliance, employers should work with relevant staff to ensure that by October 1, 2024, all job postings disclose the required wage range and benefits associated with the position and that the proposed wage range is based on one of categories identified above. Maryland will provide a form that employers may use to comply with the Wage Transparency Law, so employers should incorporate that form when available into job postings as a standard practice.

The Pay Stub Required Information Law

Starting on October 1, 2024, pay stubs issued to employees working in Maryland must include the following information for each pay period:

  1. The employer’s name (as registered with the State), address, and phone number;
  2. The date of the payment and the beginning and end dates of the applicable pay period;
  3. The total number of hours worked during the pay period (for employees that are not exempt from overtime laws);
  4. The rate of pay;
  5. The gross and net pay earned in the pay period;
  6. The amount and name of all deductions;
  7. A list of all additional pay included in the paycheck (bonuses, commissions, etc.); and
  8. For employees paid at a piece rate, the applicable piece rate and the number of pieces completed.

As with the Wage Transparency Law, the State will be providing a pay stub template that employers can use to help ensure compliance with this new law. However, employers should work with their internal staff in charge of payroll or outside companies providing payroll services to ensure that all required information is included on the pay stub by October 1, 2024.

For more information, contact Jase Tilley at 301-657-2719 or [email protected].