The Massachusetts Senate recently advanced important legislation pertaining to the issue of wage theft, S. 2416, An Act to prevent wage theft and promote employer accountability. The wage theft bill gives the state greater power to go after corrupt employers and provides additional tools for the Attorney General’s office to hold violators fully accountable.
“Wage theft preys most often upon the most vulnerable members of the workforce and it must be prevented,” said Senator Jason Lewis. “Hardworking Massachusetts workers deserve their rightful wages for the time and labor they put in. This legislation provides important protections to realize that goal.”
Wage theft, the illegal practice of not paying employees for all of their work through means such as violating minimum wage laws, not paying overtime, or forcing workers to work off the clock, has become a pervasive problem throughout the Massachusetts economy and across the nation. Many workers who are by all definitions employees are often misclassified as “independent contractors,” thereby cheating them out of minimum or prevailing wages, and leaving them on the hook for medical costs if they are injured on the job. Furthermore, employers may undermine legitimate businesses by avoiding taxes and not paying into critical safety nets for workers, putting an unfair burden on the Commonwealth when workers have a legitimate right to utilize these programs. Immigrants are particularly vulnerable to wage theft due to a reluctance to speak out against employers. As a result, these workers can sometimes go weeks without pay, and when they do get paid, it can be less than originally promised.
To increase accountability in labor contracting and subcontracting, this wage theft bill makes a company that directly contracts with an entity who commits a wage theft violation liable for wages owed to any employee of the entity. In addition, any company that directly contracts with an entity who commits a wage theft violation is held liable for any of the associated penalties and fines, if that company knew or should have known about the violation.
This legislation also gives the Attorney General the ability to issue a stop work order in response to a wage theft violation. These stop work orders would take effect 96 hours after they are served and would only apply to the violator of wage theft laws. In addition, if a company has lapsed in its unemployment insurance obligations the Director of Unemployment Assistance would also be able to issue the same stop work order as the Attorney General. Any person or entity who receives a stop work order will be provided with the opportunity to cure the violation within the 96 hours prior to the stop work order taking affect. Alleged violators are also provided with the right to a hearing upon written request within 10 days from the date the stop work order is served. To protect employees affected by a stop work order, the bill requires that employees be paid for the period that the stop work order is in effect or the first 10 days the employee was scheduled to work had the stop order not been issued.
The bill also ensures that workers are aware of their rights under the law with regard to wage theft by requiring all parties who contract for labor or services post a notice of their rights in relation to a wage theft violation in a conspicuous location. Such notice of wage theft violations, rights, and remedies would be prepared by the Attorney General and must include: information describing wage theft violations; information about the notices, documentation, and other requirements placed on employees or contracted workers in order to exercise their rights to collect wages; a description of the protections that an employee has in exercising his or her rights in regards to wage theft; and, the name, address, phone number, and website of the Attorney General’s office where questions about the rights and responsibilities can be answered.
Although formal sessions have concluded for the term, the Senate will continue to work with the Massachusetts House of Representatives and Governor Baker to advance this effort.