Stiff Penalties Await Violators of Retaliation Provisions of Wage Act

Beware Section 150

By PETER VICKERY, Esq.

How much could an employer end up paying for violating the anti-retaliation provisions of the Wage Act? Much more than you might expect.

A recent case in Worcester Superior Court involved an employer that fired an employee over her request for unpaid wages in the amount $3,750. To come close to the damages the court awarded the employee, multiply that figure by 50.

The name of the case is Wessell v. Mink Brook Associates. The plaintiff, Mary Ellen Wessell, served as the business manager for a home-restoration company called Mink Brook, whose president is Robert Stone. Wessell’s annual salary was $50,000. In late 2011, Wessell told Stone she believed one of his employees was stealing from the company.

In January 2012, Stone (who seems not to have shared her suspicions) demoted Wessell and installed as business manager the very employee Wessell suspected of stealing. Two months later, Stone refused to issue Wessell her paycheck. When they met — in the presence of Wessell’s new superior, whom she had accused of stealing — Stone accused Wessell herself of stealing, and fired her. At that point, in March 2012, the amount due Wessell in wages and unused vacation time was $3,750.

A little over two years later, in January 2014, the trial judge told the jury, “if you find that Ms. Wessell was terminated unlawfully from making a complaint regarding the Wage Act, then she is entitled to damages of the amount she would have earned if she had not been wrongfully discharged from the date of her termination, forward to this date.” The final damage award, after factoring in the termination-to-trial period (and deducting the $54,000 Wessell had earned elsewhere after her firing from Mink Brook) and then trebling the figure: an eye-watering $187,111.38.

Affirming the decision, the Appeals Court held that “an employee terminated by an employer for asserting a wage right may recover damages stemming from the termination … [which] may include earnings from the date of termination up to trial.” So the employer is liable not only for what it should have paid prior to termination but also for everything the employee would have earned during the years between termination and trial, minus whatever the employee actually earned elsewhere in the meantime.

That could be a sizable sum. It certainly was in Wessell v. Mink Brook Associates.

In arriving at this decision to affirm the judgment, the Appeals Court interpreted three sections of the Wage Act: Sections 148A, 27C, and 150. Section 148A begins, “no employee shall be penalized by an employer in any way as a result of any action on the part of an employee to seek his or her rights under the wages and hours provisions of this chapter.” It goes on to provide that any employer that fires or otherwise discriminates against an employee who has sought his or her rights “shall be punished or shall be subject to a civil citation or order as provided in section 27C.”

According to the defense, this language should limit the range of penalties available against Mink Brook to the civil and criminal sanctions described in Section 27C, and rule out the possibility of an award for back pay. The court rejected this argument, pointing to Section 150, which reads, “an employee claiming to be aggrieved by a violation of sections … 148A … may … institute and prosecute … a civil action for injunctive relief, for any damages incurred, and for any lost wages and other benefits … An employee so aggrieved who prevails in such an action shall be awarded treble damages, as liquidated damages, for any lost wages and other benefits and shall also be awarded the costs of the litigation and reasonable attorneys’ fees.”

So, although Section 27C imposes certain penalties, those penalties are not — contrary to the defense’s contention — exclusive. They could only be exclusive if the Legislature had not enacted Section 150 as well. But the Legislature did enact Section 150, whose clear and unambiguous language enables an employee to obtain “treble damages … for any lost wages.” Does that term ‘lost wages’ include back pay? Yes, said the court.

In a nutshell, if an employee rightfully complains about owed wages, and the employer responds by firing her, the employer had better hope that the fired employee finds another (highly paid) job, and fast. Even better, at the risk of stating the obvious, employers should refrain from retaliating against employees to whom they owe wages.

Finally, it is worth noting that Section 150 also applies to the earned-sick-time law, which went into effect at the beginning of July (see related story, page 28). This means employers violating any aspect of the new law face the prospect of treble damages and attorneys’ fees. For example, the sick-time law does not allow employers to ask for a doctor’s note if an employee has been out ‘sick’ for less than 24 hours. Demanding a doctor’s note in those circumstances could amount to interfering with, retraining, or denying the exercise of that employee’s rights, as could using the absence as a ‘negative factor’ when conducting a performance evaluation or when considering promotion, discipline, or termination.

Certainly, the attorney general’s sick-time regulations permit employers to seek verification if they suspect abuse of the law in some situations. But those situations are quite narrow in scope. For example, if an employer has “reasonable suspicion” that an employee aged 17 or younger is misusing sick time, the employer can seek verification from a parent or guardian. And an employer may discipline an employee of any age who is “exhibiting a clear pattern of taking leave just before or after a weekend, vacation, or holiday.”

But if the party night of choice happens to become, say, Monday instead of Friday, Saturday, or Sunday (behavioral norms having been known to adapt to changes in a legal regime), may the employer take disciplinary action upon observing a clear pattern of calling in sick on Tuesday mornings? Not under the current regulations, and not without casting a wary glance over the shoulder at Section 150.

Peter Vickery, Esq. is an employment-law specialist based in Amherst; (413) 549-9933.