Disputes over unpaid bonuses and commissions are a common issue faced by employees in Massachusetts, particularly upon termination. As employment law attorneys, we aim to provide clarity on this topic, helping you understand your rights and the legal remedies available. This article will discuss Massachusetts laws and regulations regarding unpaid bonuses and commissions, typical scenarios of disputes, and the steps you can take to address these issues.
Understanding Bonuses and Commissions in Massachusetts
In Massachusetts, bonuses and commissions are often a significant part of an employee’s compensation package. However, disputes can arise when an employee is terminated, and these earned amounts are not paid out. Understanding your legal rights is crucial to ensuring you receive the compensation you deserve.
Bonuses: Bonuses can be discretionary or non-discretionary. Discretionary bonuses are awarded at the employer’s discretion and are typically not considered wages. Non-discretionary bonuses, however, are promised to employees based on performance or other criteria and are considered part of an employee’s wages.
Commissions: Commissions are payments based on sales or other measurable performance metrics. In Massachusetts, once an employee earns a commission, it is considered wages and must be paid accordingly. The timing of commission payments is usually outlined in the employment contract or company policy.
Massachusetts Laws and Regulations
Massachusetts General Laws Chapter 149, Section 148, commonly known as the Wage Act, governs the payment of wages, including bonuses and commissions. The Wage Act requires employers to pay employees all wages earned, including non-discretionary bonuses and commissions, on time. Upon termination, all earned wages must be paid on the day of termination if the employer initiates the termination, or by the next regular payday if the employee resigns.
Failure to pay earned bonuses and commissions can result in severe penalties for the employer, including treble damages (three times the owed amount), attorney’s fees, and other costs.
Legal Implications: According to Massachusetts law, Sarah is entitled to all earned wages, including her non-discretionary bonuses and commissions, regardless of the company’s internal policies. Since she met the criteria for the bonuses and earned her commissions through her sales performance, these amounts are considered wages under the Wage Act.
How to Address Unpaid Bonuses and Commissions
Disputes over unpaid bonuses and commissions can be complex and stressful. If you believe you are owed unpaid bonuses or commissions, it is essential to understand your rights and take the appropriate legal steps. Our experienced employment law attorneys are here to help you fight for the compensation you deserve. Contact us today to for a case evaluation over the phone and discuss your case in further detail. Let us help you secure your rightful earnings and hold your employer accountable.