Leyes de Propinas y Cargos de Entrega en Massachusetts

La mayoría de los salarios de los trabajadores en Massachusetts se basan en las propinas. Por esta razón, el estado de Massachusetts tiene leyes fuertes y estrictas para asegurar que todos los trabajadores reciban las propinas que ganan. En otras palabras, cada dólar que un cliente paga como propina, debe pagarse al empleado directamente y como una propina. Ninguna parte de la propina puede ir al empleador, al gerente o a algún otro empleado con un cargo administrativo o que no tenga derecho a una propina.

A pesar de estas leyes, algunas empresas cobran a los clientes cargos por costos de entrega y otras tarifas de servicio que, aparentemente parecieran ser propinas, pero, en realidad es la empresa quien retiene estos cobros. De esta manera la empresa puede mantener sus precios y aumentar las ganancias generando estos costos a los clientes que pagan tales cargos pensando que son realmente propinas para los empleados. Esto es ilegal en Massachusetts. Si una empresa cobra a sus clientes una tarifa que el cliente espera sea pagada al empleado como un tipo de propina, la empresa no puede retener total o parcialmente ese dinero.

En la industria de los restaurantes los costos ilegales mencionados anteriormente se presentan de la siguiente manera: Cuando el cliente termina su consumo en el restaurante recibe una factura con un 15 % de cargo adicional mencionado en la factura como “costo de servicio”. Por lo tanto, el cliente no agrega una propina pues supone que ese cargo del 15% adicional es la propina para los meseros por el servicio brindado, pero, lo que sucede realmente es que el restaurante obtiene ese cargo adicional y los empleados no reciben esas propinas. Así mismo sucede con los conductores repartidores de domicilios, ellos son engañados pues la empresa, aunque incluye en la factura para el cliente el “costo de entrega”, el restaurante no paga ese dinero al conductor. Este tipo de situaciones son ilegales y se extienden a otras industrias como Hoteles, empresas de catering y compañías de limusinas donde se incluyen varias tarifas de servicio que por ley deben ser pagadas en su totalidad a los empleados.

La ley de propinas, M.G.L. c. 149 § 152, prohíbe a los empleadores conservar total o parcialmente las propinas recibidas, cargos de costos por entregas a domicilio o de servicios. La ley define cargos por costos de servicio y demás cobros de manera amplia para incluir cualquier cobro adicional que el cliente pudiera pensar que va destinado al empleado, estos costos adicionales incluyen costos de servicios, costos de entrega, costos por transporte y tarifas de instalación, entre otros. La ley también define de manera amplia cada categoría de empleados que legalmente tiene derecho a recibir propinas o cobros adicionales que hace el empleador como por ejemplo empleados de servicios generales, camareros y meseros. Los tribunales de Massachusetts han interpretado la Ley de propinas para proporcionar la mayor protección posible a los empleados y para prevenir y evitar que los empleadores implementen políticas de propinas ilegales.

En un caso reciente de la empresa Tigges v. AM Pizza, Inc., una corte federal en Massachusetts añadió una protección adicional para los empleados en este contexto. El tribunal sostuvo que incluso cuando los empleados aptos para recibir propinas firmen acuerdos de arbitraje y renuncias por acción colectiva antes del inicio de su empleo, tienen el derecho de entablar demandas colectivas que cuestionen las prácticas de compensación de su empleador en los tribunales. En Tigges, los repartidores de pizza demandaron a su empleador por cobrar a los clientes un cargo de costo de entrega en todas las órdenes a domicilio y quedarse con este valor sin pagarlo a los conductores. La compañía cobró a todos los clientes un costo de envío que osciló entre $ 1.99 y $ 2.99. Los conductores además eran empleados con derecho a propinas que recibían un salario por hora inferior al salario mínimo. Los conductores de entregas presentaron el caso como una demanda colectiva buscando compensaciones por daños y perjuicios para todos los conductores que habían dejado de recibir sus propinas debido a la política del empleador de no pagar los cargos por costos de envío que les correspondía por ley y que la empresa había estado cobrando en las facturas a los clientes.

La empresa argumentó que el caso no podría prosperar en el tribunal porque los conductores habían firmado acuerdos de arbitraje que contenían una renuncia de acción colectiva. En otras palabras, los conductores habían firmado contratos cuando fueron contratados en los cuales se les exigía que resolvieran todas las disputas con la empresa a través de arbitraje, es decir, foros de resolución extrajudicial y sólo como individuos, no como acción colectiva.

El tribunal estuvo en desacuerdo con los argumentos de la empresa y declaró los contratos inaplicables. Sostuvo que un estatuto federal, la Ley Nacional de Relaciones Laborales (NLRA), da a los empleados el derecho de participar en una acción colectiva relacionada con sus condiciones de trabajo. Ese derecho incluye el derecho a presentar demandas colectivas contra los empleadores. Una renuncia de ésta acción colectiva, como la que los conductores de reparto debieron firmar como requisito para ser contratados, eliminaría el derecho de los empleados a la acción colectiva, lo que sería una violación de la NLRA. La corte explicó que la NLRA existe para asegurar que los empleados tengan el derecho de unirse para hacer cumplir a los empleadores con sus obligaciones legales. Si a los empleadores se les permitiera exigir que los empleados perdieran ese derecho como condición para obtener un empleo, todo el propósito de la NLRA sería nulo. Con ese fin, el tribunal sostuvo que las exenciones de acción colectiva no se cumplían y que los conductores de reparto podrían presentar sus reclamaciones como un grupo colectivo.

Este caso evidencia la fuerte protección judicial para los derechos de los empleados y la importancia de las demandas colectivas. La mayoría de las veces los empleados individuales dudan en demandar a sus empleadores por tratarse de cantidades relativamente pequeñas de dinero y el riesgo de represalias por parte del empleador (a pesar de las fuertes leyes de represalias que existen bajo las leyes federales y del estado de Massachusetts). Sin embargo, una demanda colectiva permite a los empleados acercarse a su empleador como grupo y hacer cumplir sus derechos salariales mientras minimizan sus temores de represalias.

Si desea obtener más información sobre la ley de propinas y los cargos por costos de servicio o entrega, no dude en comunicarse con nosotros para una consulta gratuita y confidencial. Numero, 617-338-9400.

MA Court Adopts Relieved-of-All-Duties Standard for Meal Breaks

The Business Litigation Session of the Massachusetts Superior Court for Suffolk County heard the defendants’ summary judgment motion in our case, Devito v. Longwood Security Services, Inc., a certified class action on behalf of a group of security officers who, during breaks, had to remain in job sectors, monitor their radios, remain in uniform, and respond to calls as needed. These officers, despite performing the majority of their normal job duties while on break, had their pay from these “break” times auto-deducted from their paychecks each shift.

The defendants argued that a federal test about what counts as work should apply to our claims under the Massachusetts Wage Act and Massachusetts Overtime Law. We argued that, instead, a relieved-of-all-duties test should apply, as this test is found in our state regulations and is consistent with Massachusetts wage laws.  Under the relieved-of-all-duties test, an employer cannot deduct time from an employee’s paycheck for a break unless that employee is relieved of all of their work duties during their break.

The federal courts have declined to follow a federal Department of Labor regulation (which also calls for use of a relieved-of-all-duties test) and instead have adopted a more employer-friendly test, known as the predominant benefit test. Instead of asking whether an employee had any duties while on break, the federal test asks, who gets the most benefit from a break period when you weigh the duties and liberties during that period. If the employee is seen to be the recipient of the majority of the benefit during a break period, the employer can deduct the break time from the employee’s paycheck. This test means that an employer can make an employee perform some duties on breaks, pay nothing, and get free work.

The federal courts have endorsed this test due to old Supreme Court precedent, the fact that the federal Department of Labor relieved-of-all-duties regulation doesn’t have the force of law, and perhaps due to some general skepticism about employee claims.  We argued, and Superior Court Judge Leibensperger agreed, that our state regulation, which applies the relieved-of-all-duties test, should apply to our claims because the regulation is unambiguous and has the force of law in Massachusetts. This decision will provide important guidance about what constitutes break time versus work time in Massachusetts.

The decision can be viewed here.  Our firm is co-counsel in this case with Elizabeth Ryan of Bailey & Glasser, LLP.

How to Collect Unpaid Wages in Massachusetts

The Massachusetts Wage Act is one of the strongest wage laws in the country, protecting employees who don’t recieve earned wages, salaries, commissions and other forms of compensation. What makes the law so strong?  First and foremost, once an employee files a case for unpaid wages in court in Massachusetts, they are entitled to three times those wages if they win. In addition, the law provides that the employer, and not the employee, must pay for the employee’s attorneys’ fees and court costs.  It can very expensive for employers who fail to pay earned wages

The steps in collecting unpaid wages are straightforward.

  1. Keep all the evidence related to your wages, including any and all pay slips, time slips, employment agreement, and any emails, letters or texts from your employer.  If your employer is not faithfully keeping track of all your hours, start keeping a handwritten journal of when you arrive at work each day, when you take breaks, when you return from those breaks, and when you leave for the day.  If you are getting paid “under the table,” keep clear and detailed records of the cash you are paid.
  2. The next step is to fill out a complaint form with the Massachusetts Attorney General.  Contact us at 617-338-9400 and we’ll help you do this for no charge.  Whether you file the complaint form on your own or with our help, the result will be the same: Because of the large number of wage complaints in Massachusetts, the Attorney General almost always declines to take any direct action, but instead authorizes you in writing to file a private lawsuit.
  3. That authorization comes in a “Private Right of Action” letter, which you will receive in the mail a week or two.  If we help you, we will also get a copy of the letter in the mail.  This letter authorizes you to sue your employer in court. This is very important because your entitlement to three times your wages and attorneys’ fees only arises once your case is actually filed in a court of law (the Attorney General complaint does not count for that).
  4. Contact us or another private attorney or law firm to take the next steps of preparing and filing a court complaint. Only when this is filed and service of the complaint is made does your employer find out about the case.
  5. Once the case is in court, the professionals mostly take over. We litigate the case, demanding discovery from your employer to build the evidence required to win. Many cases settle once your employer’s attorney is confronted with the evidence and the law, but in some cases it is necessary to testify at a deposition and at trial.
  6. Assuming you prove your case and win — or, as is more common, the case settles — you receive your wages, and often more (up to three times), and your attorneys get paid by your employer, and the matter is concluded.

This are the basic steps in claiming, reporting, and collecting unpaid wages in Massachusetts. We are wage and overtime specialists and when we take on a case, we do so on a contingent fee basis, so feel free to reach out to us for a free case review.

 

Pending Wage Class Action: Right at Home

Our firm has filed suit against Right at Home, Inc. and its local franchisee, Kenney Enterprises, LLC, on behalf of a putative class of home care aids (also sometimes called “home health aids”).

The class action complaint seeks back wages, including treble damages, for the Right at Home’s violations of Massachusetts wage and hour laws. Right at Home, and its franchisee, employ several hundred hourly home care aids in Massachusetts who provide in-home health care, companionship, cleaning and personal care to the sick, disabled, and elderly.

These home care aides must use their own vehicles to travel from home to home to provide these services. However, the defendants fail to pay their employees for this travel time, as required by law. The defendants also fail to reimburse their workers for all transportation expenses, as required by Massachusetts Regulations, 454 Code Mass. Regs. 27.04.

The litigation is currently in the discovery phase. Feel free to contact us if you have information to share concerning Right at Home or other employers in Massachusetts who fail to pay for intra-day travel time or do not reimburse employees for travel-related expenses. Note: this applies to travel during the work day and not to travel between home and work at the beginning or end of the day.

Our co-counsel in this case is Elizabeth Ryan of Bailey Glasser LLP.

Getting Sued for a Non-Compete in Massachusetts

If you have ever signed an employment contract, there’s a good chance that it included a “non-compete” or “non-competition” clause. The purpose of a non-compete clause is to prevent you from taking another job in the same field as your employer’s or otherwise competing with your employer after you leave. Employers often use these clauses to gain leverage over employees, but not all non-compete agreements are valid and enforceable.

The Legal Standard

A court will only enforce a non-compete if it is: (1) necessary to protect a legitimate business interest; (2) reasonably limited in time and space; and (3) consonant with the public interest. Boulanger v. Dunkin’ Donuts Inc., 442 Mass. 635 (2004). The burden of proving enforceability is on the employer. Ultimately, the reasonableness of a non-compete clause turns on the specific facts of each case.

If a court finds that a non-compete is partially unenforceable, it is empowered to essentially rewrite the unenforceable portions of the agreement. For example, if the geographic area defined by the non-compete is too large, the court can shrink the area and leave the remainder of the non-compete in place.

Legitimate Business Interests

To be enforceable, a non-compete clause must be tailored towards protecting a legitimate business interest. Courts have recognized a number of legitimate business interests, including: protecting trade secrets, confidential information, and an employer’s goodwill (Goodwill is “the value of a company’s brand name, solid customer base, good customer relations, good employee relations and any patents or proprietary technology,” Investopedia). While simply preventing employees from engaging in “run-of-the-mill business competition” is not a legitimate business interest, courts have cited protection of an employer’s “good will” as a reason for enforcing a non-compete clause. See, e.g., Darwin Partners, Inc. v. Signature Consultants, LLC, No. 00-0277, 2000 WL 33159238, at *4 (Mass.Super. 2000) (Burnes, J.) (“Soliciting a potential client company whose relationship has been developed by the [former employer], while under the employ of [the former employer], certainly would constitute an invasion of [the former employer’s] good will”). However, if the employee is responsible for developing the good will, courts may not find a legitimate business interest. See, e.g., First E. Mortgage Corp. v. Gallagher, Civil No.1994-3727, 1994 WL 879546, at *1 (Mass.Super.Ct. July 21, 1994) (finding that good will “was the [employee’s] own making, which he had developed with customers as a result of his own enthusiasm, personality and abilities,” and therefore not a legitimate business interest).

Generally, where an employer’s purported business interest is dubious, or the non-compete clause is not drafted with an eye toward protecting the cited business interest, courts will not enforce, or will rewrite, the non-compete.

Reasonably Limited To Time And Space

A non-compete can only restrict an employee’s post-employment activities for a reasonable period of time and only within a reasonable geographic area. However, Courts have often approved non-competes that last two years. And geographic restrictions can be similarly significant, as the Supreme Judicial Court has approved a non-compete barring competition within 100 miles of the employer’s business.

However, permanent restrictions on conducting business within a geographic area are regularly found to be unreasonable. And whether the restrictions are otherwise reasonable turns on the circumstances of the case, including the type of employment at issue. For example, restricting a hairdresser from competing for two years has been found to be unreasonable given the nature of the business – the infrequency with which customers receive services (monthly intervals) does not necessarily warrant such a lengthy restriction. And where an employer attempts to restrict an employee from performing competing work in an area in which it does not conduct business, courts generally refuse to enforce such provisions.

The Public Interest

The public interest part of the three-part test requires a court to balance the benefit of enforcing contracts meant to protect an employer’s business interests with an employee’s interest in earning a living. To that end, courts generally only refuse enforcement if doing so would result in the employee being unable to work, or if doing so would harm the public interest in some tangible way. For example, a court found a negative impact on the public interest where enforcement of a non-compete would result in a community being deprived of a “fast service automobile lubrication service.” Grease Monkey Intern., Inc. v. Ralco Lubrication Services, Inc., 24 F.Supp.2d 120, 126 (D. Mass. 1998)

How To Handle A Non-Compete Lawsuit

A non-compete lawsuit begins when you receives a summons and complaint alleging that you violated your agreement. Under Massachusetts law, after you are served with a complaint, you have 20 days to file and serve a written response. If you fail to respond, you can be “defaulted,” meaning your employer can win the lawsuit based on your lack of a response. Moreover, if you file a response on your own, you may make a mistake that can harm your defense of the lawsuit and even your current employment. It is best to hire an attorney to defend you.

Once your attorney files and serves an answer, he or she can engage in discovery (seeking information and documents from your employer) and take additional steps to help defend you in the lawsuit. In non-compete lawsuits, the employer often seeks “injunctive relief” – an order from the court stopping you from engaging in the activity, like working, that they believe violates your non-compete agreement. To that end, it is common for employers to seek a preliminary injunction early in the litigation to preclude you from engaging in the business activities right away. It is very important to fight smart and hard early in the case to prevent a preliminary injunction from entering.

Non-Compete Reform

Most people weren’t paying attention, but in July 2016 the Massachusetts House Of Representatives passed a bill making significant changes to non-compete law. That same month, the Massachusetts Senate followed the House by passing an even more sweeping reform bill. The changes in both bills were significant and include: (i) limiting the length of the duration of non-competes (3 months in the Senate bill or 12 months in the House bill); (ii) prohibiting non-compete agreements for employees who are not exempt from overtime and who are terminated without cause or are laid off; (iii) requiring employers to pay “Garden leave pay” – meaning the employer is required to pay all (Senate bill) or half (House bill) of an employee’s salary during their post-employment, non-compete period; and (iv) prohibiting courts from reforming unenforceable non-competes (Senate bill).

The legislative session ended on July 31, 2016, and non-compete reform was left on the cutting room floor due to political maneuverings and compromise. There remains strong interest in non-compete reform, for reasons of fairness to employees and for promoting fluidity of labor movement to support growth in the tech industry, so when legislators reconvene in January 2017, they may take another shot at it.

Delivery Fees and Tips Law

Many workers in Massachusetts earn the majority of their wages in tips. For this reason, Massachusetts has strong laws to ensure that tipped employees receive all of their earned tips. In other words, every dollar that a customer pays as a tip must go directly to the tipped employee. No part of a tip can go to the employer, or to a manager (including any employee with any managerial authority), supervisor, or any other non-tipped employee.

Even with these laws, we’ve seen companies charge customers delivery charges or other service fees that appear, at first glance, to be a tip, but are actually retained by the company and function as a price increase. In this way, companies can then keep their prices the same, but increase profits by adding on various charges that customers believe go directly to employee. This is illegal in Massachusetts. If a company charges its customers any sort of fee that a customer would expect to go to an employee, the company cannot keep any portion of that fee.

In the restaurant industry, an illegal service charges looks like this: at the end of the meal, the customer receives a bill that includes a 15% service charge. The customer then declines to add a tip, assuming that the 15% service charge goes to the wait staff. The employer, in turn, keeps the 15% service charge and the wait staff receives no tip. Similarly, delivery drivers are cheated out of tips when the restaurant adds a “delivery fee” to the customer’s bill, but the restaurant does not pay out the delivery fee to the driver. These arrangements are illegal, and extend to other industries as well: spas, hotels, catering companies and limousine companies that include various sorts of service fees must pay the entire amount of these fees to their employees.

The Tips Act, M.G.L. c. 149 § 152A, prohibits employers from taking any portion of a tip, delivery fee, or service charge. The law defines tips and service charges broadly to include any fee or charge that a customer reasonably expects will go to the employee, and includes service charges, delivery fees, porterage fees, and setup fees, among others. The law covers wait staff employees, service employees and service bartenders, and, again, defines each category of tipped employee broadly. Massachusetts courts have generally interpreted the Tips Act to provide as much protection as possible for employees, and to deter employers from implementing illegal tip policies.

In a recent case, Tigges v. AM Pizza, Inc., a federal court in Massachusetts added an additional protection for employees in this context. The court held that even when tipped employees are required to sign arbitration agreements and class-action waivers prior to the start of their employment, they still have the right to bring class action lawsuits challenging their employer’s compensation practices in court. In Tigges, pizza delivery drivers sued their employer for charging customers a delivery fee on all delivery orders and keeping that fee rather than paying it out to the drivers. The company charged all customers a delivery charge, ranging from $1.99 to $2.99. The drivers were tipped employees who received an hourly wage less than the minimum wage. The delivery drivers brought their case as a class action, seeking damages for all delivery drivers who had lost wages due to the employer’s policy of not paying out the delivery charge.

The company argued that the case could not go forward in court because the drivers had signed arbitration agreements that contained a class-action waiver. In other words, the drivers had signed contracts when they were hired requiring them to resolve all disputes with the company through arbitration, that is, out-of-court settlement forums, and only as individuals, not as a class action.

The court disagreed and held the contracts unenforceable. It held that a federal statute, the National Labor Relations Act (NLRA), gives employees the right to engage in collective action related to their working conditions. That right includes the right to file class action lawsuits against employers. A class action waiver, like the one the delivery drivers were required to sign, would eliminate employees’ right to collective action in violation of the NLRA. The court explained that the NLRA exists to ensure that employees have a right to band together to hold employers accountable. If employers were allowed to require employees to forfeit that right in order to gain employment, the whole purpose of the NLRA would be defeated. To that end, the court held that the class action waivers would not be enforced, and the delivery drivers could bring their claims as a class.

This case signals strong judicial protection for employees’ rights and recognition of the need for class action lawsuits. Individual employees are hesitant to sue their employers over relatively small sums of wages and risk of retaliation (despite strong ant-retaliation laws under federal and Massachusetts law). But a class action lawsuit allows employees to approach their employer as a group and enforce their wage rights while minimizing their fears of retaliation.

If you want more information about the Tips Act and service or delivery charges, feel free to contact our office for a free and confidential consultation.