In yet another gift to plaintiffs’ attorneys, the Massachusetts Supreme Judicial Court just held yesterday that employees are entitled to automatic triple damages for late final wage payments even where the employer pays the employee the total due before a claim is filed. This shocking ruling in Reuter v. City of Methuen is a radical departure from settled law dating back to 2003 and is sure to embolden an already aggressive plaintiffs’ bar. What does your business need to know about this unfortunate decision?

How Did We Get Here?

You probably already know that Massachusetts has one of the strictest wage payment laws in the country, mandating automatic triple damages, attorneys’ fees, and interest for even technical or unknowing violations. The statute likewise imposes strict liability, meaning it does not matter whether the mistake was an accident, or in some cases, even if you were following guidance issued by the government or courts.

In the context of final pay, the law requires that when an employee is involuntarily terminated, the employer must provide the employee’s final wages and the balance of any unused vacation time on the day the employee is terminated. Further, an employer may not use a “post-complaint” payment as a defense to future litigation.

Understandably the immediacy of the payment creates practical problems for employers, especially when the termination is unanticipated, the employee is not present at work when they are terminated, where the employee...

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