In a departure from earlier court decisions, the Massachusetts Supreme Judicial Court (SJC) has imposed additional potential liability on employers for wage-and-hour compliance. In Reuter v. City of Methuen, the SJC explained that employers are immediately and strictly liable under the Massachusetts Wage Act, G.L. c. 149, §§ 148, 150, for all delayed wage payments – including payments made before an employee even asserts a claim. This update discusses Reuter and provides practical considerations to assist employers with Wage Act compliance.
The Wage Act is a strict liability statute that imposes liability on Massachusetts employers and certain individual officers and executives.1 Under the Wage Act, employers must pay terminated employees all owed wages on their termination dates.2 These wages include earned hourly and weekly salary, tips, accrued and unused holiday and vacation time, paid time off (PTO), earned commissions and non-discretionary bonuses, and other compensation.
Any failure to comply with the Wage Act may result in severe penalties, including actual and triple damages, attorneys’ fees and court costs. The Wage Act does not distinguish between intentional conduct and innocent mistakes, and there are no “safe harbor” provisions for inadvertent delays or miscalculations.
In Reuter v. City of Methuen, the SJC strictly interpreted the Wage Act and held that employers are automatically liable for triple the amount of any late wages...
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