Common Wage and Hour Violations in Massachusetts: A Guide for Employers and Employees
Top 10 Common Wage and Hour Violations
Understanding wage and hour laws is crucial for both businesses and employees. Violations often stem from a lack of awareness of these regulations, resulting in costly legal issues. In this detailed guide, we highlight the 10 most prevalent wage and hour violations that you should be aware of, whether you're a business owner or an employee.
1. Incorrect Overtime Classifications
Misclassifying employees as exempt from overtime pay is a frequent mistake. Not all salaried employees are exempt; specific job duties must qualify for exemption. Consult an employment lawyer if you have salaried employees working over 40 hours to ensure proper classification.
2. Incorrect Calculation of Overtime Pay
Employers can still violate overtime laws, even with correct classifications. Calculating overtime pay incorrectly for employees with varying hourly rates, such as travel time and regular work hours, is a common pitfall. Ensure accurate calculations to avoid legal issues.
3. Travel Time Violations
Understanding paid travel time is essential for businesses with employees moving between job sites during the workday. Clear rules state that travel to and from work is unpaid, while travel between job sites is paid. Keep precise time records for employees who travel during the day.
4. Deductions from Wages
Except for authorized deductions like taxes and insurance, employers should refrain from deducting from employee paychecks. Even deductions for costs that could be considered the employer's overhead can lead to legal trouble. Be cautious about any unauthorized deductions.
5. Earned Sick Time Violations
Massachusetts law mandates earned sick time for employers with 11 or more workers. Many businesses are still navigating this relatively new law. Even smaller employers must provide sick time without punishment. The law also covers time off for medical appointments and caring for family members.
6. Late Payment of Wages at Termination
Upon termination, employees must receive all earned wages and any unused vacation on the same day. Neglecting this can result in costly penalties. Ensure proper payment to avoid potential legal disputes and financial repercussions.
7. Failure to Pay Earned Commissions
Commission-based employees are protected by wage laws. Commissions should be paid according to your policy's terms, with attention to Wage Act time limits. Proper payment is especially crucial during termination, as earned commissions must be disbursed.
8. Unlawful Tip Pooling Policies
Massachusetts law has specific restrictions on tip pooling. Tipped employees can only share tips with other service staff, not kitchen staff, management, or owners. Complying with these rules is essential to avoid legal issues.
9. Deferred Compensation
Startup companies often encounter problems related to deferred compensation. Agreements with key employees to delay compensation can be considered Wage Act violations. Seek legal guidance to navigate this complex area and avoid legal battles.
10. Paying Employees as Independent Contractors
Misclassifying employees as independent contractors can violate wage and hour laws. Meeting the strict criteria for independent contractors is crucial. Don't assume safety based on industry practices; ensure compliance to prevent potential lawsuits.
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