Managing the employment relationship in Massachusetts 

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From Lexology, Laurence J. Donoghue provides guidance on managing the employment relationship in Massachusetts. Laurence writes:

Employment relationship

State-specific laws

What state-specific laws govern the employment relationship?

There is a broad Anti-discrimination Law (Mass. G.L. c. 151B) which covers all employers with six or more employees. There is also a strong Payment of Wages Law, mandating payment of all wages due to an employee (including those accrued through unused vacation time) at the time of termination. Treble damages for violation of this law are mandatory. Further, there are a number of laws relating to time off and leave of absence. For example, there is a mandatory Sick Leave Law, a Domestic Violence Leave Law, and a “Small Necessities” Leave Law (which allows time off for medical appointments, school activities, and to care for parents). Finally, employees will soon have a state-administered paid family and medical leave. Employers will begin contributing to this program on July 1, 2019 and benefits will begin to be paid on January 1, 2021.

Who do these cover, including categories of workers?

The wage laws apply to most private employers. The Anti-discrimination Law governs employers with six or more employees. The Sick Leave Law applies to all employers, but leave must be paid only for employees working for employers with 11 or more employees. The Domestic Violence Leave Law applies to employers with 50 or more employees. The Small Necessities Leave Law has the same eligibility requirements as the federal Family and Medical Leave Act. The new paid family and medical leave program appears to apply to all employers

Misclassification

Are there state-specific rules regarding employee/contractor misclassification?

Yes. G.L. c. 149, Section 148B is among the stronger state laws regarding misclassification. Generally, all work is presumed to be performed by employees (as opposed to contractors) unless certain specific requirements have been met. To be deemed an “independent contractor”, the following criteria must be met:

  • The work must be free from control and direction, both under contract and in fact;
  • The work must be outside the usual course of the employer’s business; and
  • The worker must be customarily engaged in an independent trade, occupation or profession.

Contracts

Must an employment contract be in writing?

No.

Are any terms implied into employment contracts?

An implied covenant of good faith and fair dealing is part of all employment contracts. This has been interpreted to prohibit terminations in violation of well-defined public policy, or terminations designed to deprive employees of commissions or other earnings due to past services. With respect to the public policy exception, Massachusetts courts have been relatively restrictive regarding the types of public policy which give rise to a legal claim. Further, if the public policy is set forth in a statute which contains its own cause of action, the employee will be limited to proceeding under the statute.

Are mandatory arbitration agreements enforceable?

Generally, yes, although arbitration provisions must be drafted with care if the intention is for them to have broad scope. To be enforceable regarding statutory claims, the arbitration provision should make at least some reference to either the statute (i.e., the Massachusetts Wage Act) or type of claim (i.e., discrimination claims). This area of the law is somewhat dynamic, so employers should ensure that the most recent judicial pronouncements have been reviewed before drafting arbitration provisions. Private arbitration agreements generally do not deprive state investigatory agencies (e.g., the Massachusetts Commission Against Discrimination or the Office of the Attorney General) of their right to investigate.

How can employers make changes to existing employment agreements?

No specific requirements exist in this regard. The terms of the agreement should establish the means of amendment. Except with regard to the introduction of non-compete agreements (where additional consideration is required for agreements entered into on or after October 1, 2018), continued employment is generally adequate consideration to make changes in terms of an at-will employment relationship.

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Source: Managing the employment relationship in Massachusetts – Lexology

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