President Obama has signed an executive order barring federal contractors from retaliating against employees for discussing salaries with each other, reports NPR.
The executive order applies only to employers that do business with the federal government. If you don’t fall into this category, you can look the other way, right? Wrong. Even if you aren’t a federal contractor, it is generally illegal to prohibit your employees from sharing salary information. You can thank the National Labor Relations Act (29 U.S.C. §§ 151-169), and on the state level, Massachusetts General Laws Chapters 150A and 150E.
Prohibiting your employees from sharing salary information may appear to be reasonable at first glance. After all, it’s confidential information, right? Yes, but each employee has the right to decide whether and how to disclose his/her own salary information. And if he/she wants to discuss salary with co-workers in an effort to lobby for improved working conditions, then that’s the employee’s prerogative.
“But my business isn’t a union environment,” you might retort. The National Labor Relations Board (NLRB), frankly, doesn’t care. A strict reading of the law indicates that it doesn’t apply to just union shops, but any group of employees who wish to bargain collectively.
The bottom line is that virtually every employer in Massachusetts – even those with the best of intentions – violates the law when it directs employees to “respect confidentiality” by not gossiping about salaries. Of course, each situation can present its own uniqueness, and there are some specific circumstances that, if present, can make the question more difficult to answer. Thus, you should discuss specific situations with a Massachusetts employment or labor attorney.