Wage Theft

Wage theft is the failure to pay employees the wages and benefits to which they are legally entitled. In Massachusetts, the primary wage law is known as the Massachusetts Wage Act. It is strictly enforced, and violations of the Wage Act, may result in your employer having to pay triple damages and attorneys’ fees.

Some violations of the Wage Act are fairly straightforward.

Failing to pay commissions, wages or overtime wages
Failing to pay tips, typically in the restaurant/bar industry
Failing to pay wages for agreed upon paid time off, like unused, accrued vacation time
Failing to pay prevailing wages on public works projects
Failing to pay employees who are undocumented workers

Other types of wage theft may be less obvious and involve less known laws. Wage discrimination under the Lily Ledbetter Equal Pay Act, which requires employers to ensure that their payment practices are not discriminatory is a form of wage theft.

Similarly, misclassifying employees is also wage theft. There are generally two types of misclassification, misclassifying employees as “exempt” from hourly wages or misclassifying employees as independent contractors.

Misclassifying Employees as “Exempt”

There are two classifications of employees under the Fair Labor Standards Act. They are “exempt” and “non-exempt.”

Exempt employees are paid a salary for the work that they perform. They are not eligible to receive overtime pay, and they are excluded from minimum wage requirements. Exempt employees include certain administrative employees, i.e., those working human resources, accounting, legal, public relations, etc.; executive employees, i.e., managers and supervisors; professional employees, i.e., doctors, lawyers, engineers, nurses, etc.; creative professionals, i.e., writers, actors, musicians, etc.; outside sales employees, i.e., sales people and marketers; and computer related employees, i.e., programmers, software engineers, etc.

Non-exempt employees are guaranteed an hourly wage and overtime pay. They must be paid the minimum wage for every hour worked up to 40 hours per week, and they must be paid overtime for every hour worked in excess of 40 hours per week. Non-exempt employees include contractors, freelancers, interns, servers, retails associates, etc. Misclassifying employees, who should be paid on an hourly rate, as salaried employees and exempt from overtime is wage theft.

Misclassifying Employees as Independent Contractors

To be classified as an independent contractor, an individual must (1) be free from the direction and control of the employer; (2) be performing a service that is outside the usual course of the business of the employer; and (3) be engaged in a trade, occupation or profession of the same nature as that of the service performed.

If this three prong test is not met, then the individual performing the service is an employee–not an independent contractor–and is entitled to be paid as an employee.

Hourly wages - if your employer agrees to pay you at a certain rate per hour, they are required to do so by law for your labor.
Overtime - In Massachusetts, employers are required to pay time and a half of your regular hourly rate if you work more than 40 hours in a week.
Accrued Leave - Employers are required to pay for vacation, sick or compensatory time.
Tips - Employers cannot legally withhold tips you’ve received while working and must pay them to you.

The bottom line is that wage theft in any form is illegal. If you or a family member thinks that you have been the victim of wage theft, call KJC Law Firm for a free consultation.

We will tell you whether you have a case and help you get compensation for your loss. The lawyers at KJC Law Firm have more than 125 years of experience litigating major cases. KJC Law Firm represents people from communities across Massachusetts, including the Greater Boston area, Cambridge, MetroWest, Worcester, Springfield, Cape Cod, Fall River and Lowell.