Below is a list of common mistakes employers make in wage payments.
- Untimely payment of wages
Massachusetts requires employees paid on an hourly basis to receive their paychecks on a weekly or biweekly basis. Salaried employees can be paid weekly, biweekly or semimonthly. Employers cannot pay salaried employees on a monthly basis unless the employee actually chooses to be paid monthly. Employees who work overtime must receive their overtime pay in the same pay cycle in which the overtime hours were worked.
- Failure to pay wages upon termination
An employer must pay on the final day of employment all wages owed to an employee who is terminated or laid off. When an employee leaves voluntarily, the employer can wait and pay all of the employee’s wages by the next regular payday. Employers must pay employees all accrued and earned vacation time.
- Mischaracterization of employees as exempt or nonexempt
Massachusetts and the Federal Fair Labor Standards Act required employers to pay employees overtime unless the employee meets one of the defined exemptions. If you are unsure if you have been mischaracterized you should consult with an attorney to find out if you are entitled to overtime.
- Failure to pay overtime for salaried employees
Employees who are eligible for overtime pay must be paid one and a half times their regular rate for every hour worked after 40 hours. Oftentimes, an employer will unknowingly violate the overtime laws because the employer believes overtime pay is already incorporated in the employee’s salary. Massachusetts law does not allow an employer to “incorporate” overtime pay into an employee’s salary. In addition, the mere fact that an employee is paid a salary does not mean the employee is ineligible for overtime pay.
- Misclassification of employees
In Massachusetts it is very difficult to meet the requirements of independent contractor. Massachusetts law presumes an individual is an employee unless the individual (i) is free from the employer’s actual control and direction; (ii) performs a service that is “outside the usual course of business of the employer”; and (iii) is “customarily engaged in an independently established trade, occupation, profession or business of the same nature as that involved in the service performed.
- Improperly taking deductions from wages
Employer are generally prohibited from deducting from employees’ wages payments for, damage or losses to company property, monies stolen or embezzled from the company. There are only limited occasions in which an employer may properly take deductions from wages.
- Improperly permitted comp time in lieu of owed overtime
Employers are prohibited from offering comp time or time off in lieu of earned overtime wages. Employees are entitled to time and a half payment for all hours worked overt forty hours in a workweek.
