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Employee Collects Triple Damages After Boston Business Violates Wage Law

Posted on Jun 09, 2011

A Massachusetts judge found that a Boston business violated the Massachusetts wage law when it deducted money from an employee’s weekly paycheck for a retirement contribution but then never deposited the wages into a retirement account. The judge then awarded triple damages of $25,814 plus attorney’s fees to be paid to the employee.

The Boston real estate investment and development company had promised its employee that it would set up a retirement account into which the employee could make contributions. In December 2005, the employer began deducting money from the employee’s weekly paychecks. These deductions went on for at least two years.

During those next two years, the employee made inquiries about the status of his retirement account and his funds, but the employer’s administrators ignored him. The judge found that the employer never bothered getting around to setting up the account and instead withheld the money. The amount of the weekly deductions over this time frame was $8,604.80.

Sometime in the Spring of 2009, the company offered the employee a check for the $8,604, but as a condition for the money, the employee was to release any claims. The employee refused and then filed the lawsuit alleging that by withholding the money from his paycheck but not putting it into a retirement account as promised was a violation of the Massachusetts Wage law.

There are important messages to learn from this case as an employee:

First, the Wage Act states that an employer must pay an employee his wages within six days of the ending of the pay period during which those wages were earned. So, for example, if a weekly pay period is Monday through Saturday, then an employee must receive his wages by the following Friday. In this case, by withholding weekly deductions from its employee and not putting them into a retirement account as promised, the judge found the employer had failed to pay its employee within the six day time period allowed under the law.

Second, the Wage Act has very harsh penalties in an employee's favor. Under the version of the Wage law adopted in July 2008, when an employee proves that the employer violated this section of the Act, then the court must award triple damages. It is mandatory. And, the employee is entitled to recover his attorney’s fees and expenses. So, in this case the judge multiplied the employee’s back wages of $8,604 by three and ordered damages of $25,814. The judge also allowed the employee to seek an award of his attorney’s fees and costs (that amount had not been decided as of the publication of this news story).

It is extremely enlightening to know that not only can you win such a case against your employer, but the judicial system has been set up to compensate you at triple the damages.

If you feel that your employer is withholding wages from you and would like to speak to an attorney or learn more about the laws, fill out the contact form on the right or call us at 508-998-0800.