Prevailing rate is the regular rate for purposes of calculating overtime

The Massachusetts Supreme Judicial Court, in Mullally v. Waste Management of Massachusetts, has ruled that employers must use the prevailing rate for purposes of calculating overtime on all public works projects.

The Massachusetts overtime statute, M.G.L. c. 151, § 1A, states that “no employer in the commonwealth shall employ any of his employees …for a work week longer than forty hours, unless such employee receives compensation for his employment in excess of forty hours at a rate not less than one and one half times the regular rate at which he is employed.” While the language of the statute seems clear enough, employers have argued that the “regular rate” need not be the prevailing rate, as long as employees are compensated at the prevailing rate for all hours worked.

Title 455 of the Code of Massachusetts Regulations, § 2.20(3), clearly provides that the overtime rate shall be “one and one half times an employee’s regular hourly rate, such regular hourly rate not to be less than the basic minimum wage.” The SJC has determined that “[t]he applicable minimum wage for public works projects is the prevailing wage.”

Accordingly all employees on public works projects must be paid at a rate of one and a half times the prevailing rate for all hours worked beyond 40 hours a week.

If you work on a public works project for a city or town in Massachusetts and your employer refuses to pay you the prevailing wage or overtime at one and a half times the prevailing wage, give us a call..