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From Boston Bar Journal - Workers’ Rights Keep Pace With Corporate Practices: Recent SJC Decisions Expand Reach of Wage & Hour Laws

by Jocelyn B. Jones 

Case Focus

Only 20 years ago, criminal prosecution was the sole means of enforcing the Massachusetts wage and hour laws. But the enforcement landscape has changed dramatically since 1993, when enforcement authority was transferred to the Attorney General’s Office from the former Department of Labor & Industries, and employees were authorized to initiate private lawsuits, in which those who prevailed were entitled to treble damages and attorneys’ fees, among other remedial measures. A further transformation took place in 1998, when the Attorney General was granted civil citation authority and monetary penalties for violations were enhanced, and with them, greater deterrence was set into play. The Legislature’s addition of these enforcement mechanisms in the 1990s increased  the development of wage and hour related case law, particularly at the appellate level. This rather dramatic expansion of case law in the wage and hour arena has accompanied the crystallization of the viewpoint expressed by the Massachusetts Supreme Judicial Court (“SJC”) that these legal protections are to be interpreted broadly, to ensure that the laws accomplish their underlying goal of guaranteeing that all workers receive their earned wages.  Consistent with this view, two recent SJC decisions underscore the expansive reach of the wage and hour laws’ protections.

LLC Managers & Wage Act Liability

In Cook v. Patient Edu, LLC, et al., the SJC addressed an issue of first impression about whether managers of a Limited Liability Company (“LLC”) may be held personally liable for violations of the Massachusetts Wage Act, M.G.L. c. 149, §148. A former employee brought suit in Superior Court against the LLC, as well as two of its managers, for unpaid wages. Relying on the statutory language and the express legislative purpose of protecting employees from long-term wage detention, the SJC concluded that “[b]ecause a manager or other officer or agent of an LLC…” may be a “person having employees in his service,” if he “controls, directs, and participates to a substantial degree in formulating and determining policy” of the business entity, he may thus be civilly or criminally liable for violations of the Wage Act.

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