UPDATED November 7, 2019: Due to an impressive level of pushback from Massachusetts workers, the provisions in the Baker budget that would have deprived commission-only workers of their earned overtime were removed during deliberations in the Massachusetts legislature. Two key takeaways from this: (1) your calls, emails and letters to your state legislators matter, keep them up, you can find your legislators here; (2) those calls and emails are really going to matter this winter and spring of 2019-2020 because the Massachusetts legislature created a commission to study whether or not the industry should going to get what it wants, a reduction in overtime rights for commission-only and other Massachusetts workers. That commission must file a report by the first day of March, 2020. Please make your views known to your Massachusetts state legislators, and we’re optimistic we can prevail. Updates will be posted here.
Original Article, posted September 20, 2019:
In September, Governor Baker introduced a supplemental budget bill meant to retroactively take away earned overtime from car salespeople and other commission-only workers who work overtime. And the Governor goes even further than that, seeking to strengthen employers’ hand in overtime disputes by creating new defenses to all overtime claims. If this bill is enacted into law, it will have sweeping and harmful consequences for the middle-class in Massachusetts.
Baker’s proposed changes to the law were tucked away in a supplementary budget normally meant to settle the state’s books before end of the year (like modifying the snow removal budget). Notably, the Governor did not mention employees or overtime in his press release for the supplemental budget. For Massachusetts employees, Governor Baker’s bill would do three critical things:
- Retroactively eliminates Sunday pay and overtime protections for commissioned employees, slashing key protections that have been in place for decades;
- Enable employers to manipulate the administrative process to create new defenses to the wage laws, which have traditionally been construed strictly so that workers get paid their earned wages; and
- Extract lawfully earned wages out of Massachusetts citizens’ pockets by retroactively classifying them as exempt under the Wage Act, Overtime Laws and Blue Laws.
If the bill is passed with these provisions, millions of dollars in overtime and Sunday pay, owed to thousands of hard-working Massachusetts residents, will instead go back to the businesses making these proposals.
The May 2019 Supreme Judicial Court issued its decision in Sullivan v. Sleepy’s LLC, SJC-12542, ruling that the overtime law, prior caselaw, and administrative regulations have all required and continue to require that employers make separate and additional overtime and Sunday pay for non-exempt sales employees, even if they are paid on a commission-only basis. Department of Labor regulations made this requirement abundantly clear back in 2015, when the DLS promulgated the following regulatory language: “Whether a nonexempt employee is paid on an hourly, piece work, salary, or any other basis, such payments shall not serve to compensate the employee for any portion of the overtime rate for hours worked over 40 in a work week.” 454 Code. Mass. Regs. 27.03(3). The language presented in the budget bill represents a wholesale upending of the SJC’s decision confirming that the existing legal requirements require that employers pay commissioned employees overtime and Sunday pay.
The Governor’s allies have argued that the proposed changes to the law would merely bring Massachusetts law in line with Federal law. However, this sidesteps a key fact: Through the legislative process, workers in Massachusetts have won additional rights that do not exist in, say, Florida or Iowa, so matching Massachusetts law to federal law result if those rights and benefits being lost. And dramatically so here, where the thousands of workers have already earned wages that may be retroactively taken away with a stroke of a pen.
This story is ongoing as of October 3, 2019.