On April 4, 2022, the Massachusetts Supreme Judicial Court ("SJC") issued a pointed reminder to employers that the failure to comply with the strict technical requirements of the Massachusetts Wage Act will be costly. The Wage Act requires an employer to pay all wages, including accrued but unused vacation time, on the date that it terminates an employee. The SJC confirmed that if an employer misses that deadline, even by a little bit, the employer will be liable for treble damages on the whole amount, not just for interest on the late payment, plus attorneys' fees. This decision will have significant ramifications for employers and employees.
In 2003, a Superior Court judge held in Dobin v. CIOView that if an employer paid an employee's final wages after the termination date — but before an employee filed a complaint with the Attorney General's office — the employer would only be liable for interest.
This week, in Reuter v. City of Methuen, the SJC reached a dramatically different conclusion. In Reuter, the employee was owed nearly $9,000 in vacation pay when she was fired after being convicted of larceny. She did not receive her vacation pay until three weeks later. A year after that, the employer paid her $185 as compensation for the interest accrued during the three week delay, multiplied by three. The employee argued that she was entitled to triple damages on the entire amount of the late payment plus attorneys' fees, for a total of more than $23,000. After trial, a...
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