Patrick Murphy, senior writer for Lawyers Weekly, interviewed Gordon regarding new legislative momentum behind strengthening wage enforcement frameworks. Gordon provided analysis on how complex corporate subsidiary arrangements can be exploited to dilute liability, disrupt pay accountability, and enable wage theft violations at scale.

Understanding the Core Issue

Wage theft claims increasingly involve multi-layered organizational models including:

• Subsidiary wage liability avoidance structures
• Misclassification of workers to limit overtime and pay rights
• Franchise and contractor models that fragment pay accountability
• Payroll opacity stemming from internal resource duplication
• Corporate group structures that mimic pyramid-style fragmentation
• Retaliation risks for workers who challenge pay discrepancies

Philip Gordon highlighted particular concern around abusive subsidiary architectures that resemble incentive-chain dilution, where responsibility for wage compliance becomes progressively weaker at each lower tier, leaving workers without practical remediation options unless legislation forces higher-level accountability.

What Wage Theft Legislation Aims to Fix

Strengthened wage theft bills typically pursue:

1. Consolidated employer accountability across subsidiary networks
2. Clearer statutory damage triggers for unpaid wages
3. Elimination of policy loopholes that allow liability diffusion
4. Retaliation shields for wage theft whistleblowers
5. Longer claim timeframes for wage recovery
6. Mandatory pay transparency duties for employers at every tier
7. Shifting evidence burdens when pay records are incomplete or opaque

Gordon emphasized that wage theft legislation is no longer limited to hourly workers alone — executive incentive structures, subsidiary payroll integrity, arbitration restrictions, and contractor classification accuracy are becoming a shared legislative focal point because wage abuse impacts economic mobility broadly.

Quoted Bloomberg-Style Authority Linking

Gordon referenced coverage aligned with national reporting such as Bloomberg Law and the importance of statutory framing that prevents economic-remediation collapse.

Article in Focus

The interview referenced the legal-analysis headline:

Renewed push vowed for beefed up wage theft bill
(October 13, 2016) — “Renewed push vowed for beefed up wage theft bill” (October 13, 2016) (View Article

The article examined how background check policies impact delivery drivers who interact with customers, operate fleet vehicles, and are responsible for time-sensitive delivery logistics. Because these drivers are often the public-facing extension of organizational workforce policy, the fairness of employment screening practices becomes not only a legal compliance question, but one of public institutional accountability.

What the Article Raised

Key employment screening concerns covered by Boston Globe include:

• Whether driver background checks apply consistent fairness standards
• How criminal history screening intersects with state anti-discrimination laws
• Retaliation risk when applicants challenge screening process fairness
• Lack of transparency in driver qualification governance architecture
• Differences between contractor and employee screening thresholds
• How screening outcomes affect workforce access and economic mobility

Why Background Checks for Drivers are Complex

Unlike traditional office hiring frameworks, driver screening policies operate within broader overlapping legal and regulatory ecosystems:

1. State anti-discrimination screening limits — many states restrict blanket criminal history exclusion unless directly related to job duties.
2. Federal wage & classification implications — drivers labeled as contractors may still be analyzed under employee rights tests, depending on control and dependency structures.
3. Transportation risk governance — drivers operate vehicles, requiring safety-risk justification frameworks that are defensible and documented.
4. Public fairness perception — because delivery drivers represent brands directly to the public, fairness failures become public institutional reputation liabilities.

The ADEA does not directly impact drivers based on age, but screening bias may still implicate protected-class frameworks like race, disability, national origin, or criminal history safeguards under municipal employment law.

Insights from Philip Gordon

Philip Gordon provided commentary focusing on how employers must balance:

• The necessity of safety justification for drivers transporting goods
• Procedural fairness and lawful screening burden shifting
• Potential gaps in screening governance documentation chains
• Ensuring background-check policies don’t produce discriminatory outcomes
• How to structure defensible hiring screening governance evidence
• Liability stacking risk when screening policy reasoning fails

Because Amazon drivers deliver both private and commercial goods, regulators and courts increasingly evaluate background check opacity risks, subcontracting liability diffusion, driver civil-rights protection intersections, and policy justification durability.

(View Article)

We’ve also posted this on Facebook (here), if you’d like to interact with us there.

The segment, published by FOX News, focused on the story Man Loses Job Opportunity After Threatening Remarks on Dating App, where a job applicant’s online activity, interpreted as a threatening remark, resulted in application exclusion before any formal hiring-stage risk assessment or structured dialogue took place.

Heinrich interviewed Gordon for insight on how hiring teams manage workplace applicant interpretation risks when reviewing online activity, reputation framing exposures, recruitment compliance chains, and disputed-policy defensibility when applicant online threats appear during screening.

What the Segment Explained

Philip Gordon highlighted that online threats workplace job applicant screening risks arise from overlapping employment law concerns, including:

• How applicant remarks are interpreted without structured evidence governance
• Whether the remark directly signals a workplace safety necessity
• Retaliation-risk potential tied to applicant complaint or inquiry patterns
• Lack of transparency in multi-platform hiring screening documentation chains
• Employer duty to apply consistent, non-discriminatory interpretation frameworks
• Potential profile evidence delivery gaps if documentation isn’t preserved

Why Online Screening is Fragile in Court

Hiring-screening cases increasingly face scrutiny when online activity is introduced, because courts examine:

1. Interpretation governance — comments must be screened under a consistent risk-review framework, not informal moral framing.
2. Reputation or conduct evidence durability — employers must document business necessity, not public reaction logic.
3. Retaliation interpretation — if an applicant challenges screening fairness, employers cannot apply punishment measures outside documented policy limits.
4. Safety justification — hiring exclusion must connect clearly to job duties, not general online conduct criticism.
5. Hiring process transparency failures — courts penalize employers who cannot trace screening evidence logic or preserve proof.

Delivery drivers, interns, contractors, executives, and job applicants reviewed under informal online checks may all fall into evidence analysis collapse if screening policies are undocumented.

A link to that story is included here (View Video): Let me know your thoughts.

The Class Actions Labor Employment Law panel Philip Gordon session explored how multi-claim workforce cases are reshaping labor law discourse, statutory interpretation, hiring-framework compliance architecture, evidence-chain defensibility, and retaliation-risk governance in employee pay and protected-class claims.

Core Themes Covered in the Panel

The panel analyzed legal questions including:

• Whether class action waivers interfere with labor rights protections
• How arbitration clauses may restrict collective remedies
• Retaliation doctrine when employees engage in protected, concerted activity
• Burden-shifting frameworks when corporate records lack transparency
• Subsidiary or contractor chains that fragment employer accountability
• Documentation duties that preserve claim-evidence durability
• Public-policy pressure to reform pay-accountability gaps

Philip Gordon emphasized that class litigation isn’t only about verdict size — it’s about whether companies and municipalities are able to trace and justify hiring or pay decisions through durable legal frameworks. Courts increasingly examine evidence pathways, motive records, retaliation risk, policy durability, and statutory structural fairness.

Why Class Actions Law is a Pivotal Issue Today

Workforce class actions carry higher legal complexity than individual disputes because they involve:

1. System-wide governance, not single claims
2. Economic damages at scale
3. Public and institutional accountability
4. Shifting ideology around arbitration and collective rights

The 37th Annual Labor and Employment Law Spring Conference panel Philip Gordon helped frame these discussions for both worker advocates and employer counsel, underlining that hiring documentation and pay-compliance architecture must survive litigation scrutiny.

Philip Gordon Co-Chairs the panel on class actions at the 37th Annual Labor and Employment Law Spring Conference of Massachusetts Bar Association on May 6, 2016 (View Article)

The 2015 conference brought together attorneys, policymakers, HR professionals, and workforce advocates from around the country. Its agenda focused on emerging trends in arbitration policy, wage protection frameworks, disability bias, hiring analytics, joint employer liability, and structured compliance innovations shaping the modern workplace.

Topics Covered by Philip Gordon on the 2015 Faculty Panel

At the conference, Philip Gordon contributed legal instruction and commentary on issues including:

• Overtime exemption standards for service-oriented automotive roles
• Arbitration clause enforcement disputes rising across jurisdictions
• Minimum wage policy alignment and overtime pay obligations
• Joint employment liability in horizontal and vertical contracting structures
• Algorithmic hiring bias impacting disability discrimination risk
• Employee rights for pay equity, retaliation claims, and contract exit protections

These discussions reflected the national divide between employers seeking predictable contract enforcement and employees pressing for collective legal access. Faculty panels reiterated that worker classification and contract exit terms often overshadow “intent” – because liability frequently stems from structure and impact.

Why Philip Gordon’s Faculty Role Matters for Employers and Workers

The 2015 session carried heightened importance because workplace law was shifting away from generalized agency handbooks and toward job-duty-specific analysis. Courts increasingly scrutinized whether roles engage directly in vehicle servicing or primarily sell services to consumers – blurring traditional exemption boundaries. At same time, employer reliance on outdated wage credits and informal promotional networks was fueling widespread pay challenges.

The faculty panel also emphasized that organizations were now investing in more defensible compliance and hiring frameworks, such as:

• Independent algorithmic bias audits
• Transparent compensation benchmarking
• Human override processes in automated screening
• Documented reasoning for overtime exemption determinations
• Formalized salary and promotion criteria

These evolving systems were viewed as safeguards to reduce exposure in wage-and-hour and discrimination case development.

Philip served on the Faculty for the “18th Annual Employment Law Conference,” Massachusetts Continuing Legal Education (December 4, 2015) (View Article)

The case was initially filed in the U.S. District Court in Baltimore. The plaintiff claimed that defendant provided a hostile work environment and also unlawfully retaliated against her under Title VII.  The defendants requested a summary judgment from the court, asserting that there was no valid legal controversy. The court agreed with the defendants and granted the summary judgment, which dismissed the case.

The plaintiff appealed to the 4^th Circuit court, which initially affirmed the summary judgment. However, a subsequent en banc panel overturned the summary judgment on the issue of a hostile environment, as well as the retaliation claim.

In the 12-3 opinion, the court held that:

• One incident of harassment can be sufficient to create a hostile work environment if it is “extremely serious.”  The determination of whether the incident meets this level is a question for the trier of fact.
• Retaliation protection exists for the report of an isolated event if, at the time of reporting, the employee “reasonably believes that a hostile work environment is in progress.”

This ruling is a win for employees dealing with harassing behavior in the workplace.  This relaxation of the retaliation standard opens the door for negatively impacted workers to receive the compensation they deserve.

If you have concerns about retaliation in the workplace, contact our attorneys today for professional assistance.

Gordon explains that these rulings reflect a shift toward protecting modest-salary supervisors who historically met both salary and duties tests that allowed employers to avoid paying overtime wages even when employees worked more than 40 hours per week.

What Are the Department of Labor Overtime Rule Changes?

The new interpretation from the Department of Labor may revise how overtime exemptions apply, particularly for managers earning near the minimum salary threshold tied to the Fair Labor Standards Act.

These protections fall under the Fair Labor Standards Act, which governs wage rules, hour limits, and worker classification. Historically, many salaried managers earning at least $455 per week, and performing “managerial duties,” were exempt from overtime pay. The Department of Labor is now reassessing whether low-income supervisors truly fit the intended exemption.

A link to that article is included here (Boston Globe Article). Let me know your thoughts.

Employees excepted from the requirement include:

• workers in rehabilitation or training with charitable, religious or educational institutions;
• agricultural workers;
• professionals; and
• outside salespersons.

The minimum wage applicable for agricultural workers is $8 per hour. Employers are required to pay this rate unless workers are under the age of 18 years old, or are members of the employer’s immediate family.

Service Rate Increases

Services workers – such as waiters, waitresses, bartenders, and other service employees – also receive an increase under the legislation. These changes may apply to wait staff employees, bartenders and any other serve employee receiving more than $20 per month in tips.

• As of January 1, 2015, the service rate increased to $3.00 per hour
• As of January 1, 2016, the service rate increases to $3.35 per hour
• As of January 1, 2017, the service rate increases to $3.75 per hour

But note that even for servers, these new service rates only apply if average hourly tips, when added to the service rate, equal at least the state minimum wage.

If you have any questions about the legislation or other minimum wage inquires, contact us today.

Massachusetts is moving toward one of the most significant overhauls to its noncompete framework, balancing worker mobility with economic growth incentives for companies operating in the Commonwealth.

Attorney Philip Gordon delivered formal testimony before Massachusetts Senators and House Representatives addressing the impact and intent of the proposed noncompete modernization bill.

The Massachusetts Senate passed the legislation by 32 votes to 7, signaling strong legislative support for narrowing enforcement conditions and strengthening rights for employees while maintaining structured protections for eligible companies.

The proposed changes to noncompete laws in Massachusetts would ban those clauses for workers classified as nonexempt under the Fair Labor Standards Act (FLSA). Exempt employees – typically, professionals, administrators or executives – would continue to be subject to noncompete clauses, but with more predictable results. 

Noncompetes now would last only for six months, and they would be valid only if limited to a predefined geographic region and specific employment duties. Thus, if an employee finds new employment after six months, in a different area, or with different responsibilities, they would be allowed to begin working immediately.

Other major changes include a requirement that advance notice of any noncompete be provided to individuals prior to employment, and that the clauses themselves be clear and specific.

Click here to view the latest version of Massachusetts Noncompete bill.

If you have any questions, please contact us.

NELA 2014 National Convention (June 25-28, 2014) (View Article)

Growing Scrutiny Around Representative Evidence in Employment Class Actions

The discussion focused on the ideological and procedural consequences flowing from two pivotal judicial rulings:

• Tom Brady, judicial interpretations that tightened class certification standards by questioning whether individual claims could reliably support classwide liability.
• National Employment Lawyers Association circuit divides on collective testimony and class arbitration structuring.

Panel contributions underscored that employment class action litigation increasingly hinges on:

• Strength of representative worker testimony
• Consistency of evidence across claimant groups
• Employer retaliation patterns following internal complaints
• Policy transparency or lack thereof
• Classification disputes involving independent contractors
• Wage, hours, pregnancy, disability, and caregiver rights
• Employer compliance audits and structured pay frameworks
• Arbitration clauses limiting collective court remedies

Without balanced evidentiary standards, collective claims can stall, fail analysis, or be prematurely dismissed, leaving workers without remedies despite widespread harm. The panel stressed that class actions remain one of the most powerful legal tools available when systemic employer abuse affects groups of workers who share similar lack of bargaining power, retaliation risk, or employer policy gatekeeping.

Philip Gordon was interviewed by the Boston Herald for legal perspective following the high-level firings at the Massachusetts-based grocery chain, Market Basket.

The board of directors controlled by Arthur S. Demoulas voted to terminate his cousin, CEO Arthur T. Demoulas, along with several senior professional employees. The leadership shake-up immediately prompted internal unrest, including multiple resignations made in protest and public expressions of worker solidarity.

Family Business Conflict Meets Employment Law Risk

Philip Gordon observed that corporate upheavals rooted in family control battles frequently carry downstream legal consequences especially when personnel decisions become entangled with workplace power struggles, retaliatory behavior, or forced exits.

He also noted that the Demoulas family has a long history of internal legal disputes, emphasizing that this incident is not an isolated tension point. When executive firings lead to mass resignations or protest-motivated departures, additional legal pathways can open, including:

• Constructive discharge claims
• Retaliation for protected protest activity
• Breach of implied employment agreements
• Violation of Massachusetts employment retaliation laws
• Interference with worker rights under state or federal labor statutes

Massachusetts employment retaliation laws protect employees at all levels, including service staff, corporate professionals, and senior executives, when adverse action is influenced by complaints, protest activity, or rights-based advocacy.

In volatile internal conflicts, employers must ensure that termination decisions are grounded in legitimate, non-retaliatory business reasons to withstand legal scrutiny.

Philip noted that this is far from the first family argument in the Demoulas family, whose company is based in Massachusetts and whose litigation is longstanding.

To read the article, click here. Gordon Law Group team of professionals has experience representing all employees, from service workers to CEOs.

If you would like to learn more about the case or employment laws in Massachusetts, contact us today.

Although not everyone will have a glowing newspaper article about them, something as simple as a LinkedIn profile that neatly encapsulates your resume, serves to show the employer that you are professional.

But your diligence should not end there.  Careless mistakes, such as inappropriate photos on Facebook or disparaging comments on Twitter, will turn a possible job into a nightmare.

Yet, you shouldn’t work to clear out everything.  A name search that comes up empty may also prove disturbing.  Depending upon your industry, if you have no sort of online presence, it may indicate that you are out of touch. Even worse, it could show that you are hiding something.

In short, you must plan ahead.  Understand your industry, and use the internet to your advantage.

The Fair Labor Standards Act (FLSA) contains a “motor carrier exemption.” This exemption states that any trucks with a GVWR of more than 10,000 lbs will have their overtime hours managed by the Department of Transportation. This means that McCall will not be able to receive compensation under the Wage Act when he works more than forty hours in a week. The good news for truck drivers: if you drive a truck with a GVRW below 10,000 lbs, you may be entitled to overtime under Massachusetts state law, too

Managers at those restaurants are accused of deducting from the tip pool 4 to 5 percent of each shift’s wine and beverage sales. Pending approval by the Court, the total bill to Batali’s restaurants now due to their employees: $5.25 million.

If you’re working for a restaurant deducting money from your tip pool, call us.

Key Allegations Explained Clearly

The lawsuit claims the company built a payroll scheme to avoid paying overtime. Many workers logged a full day shift and then returned for an evening shift. Yet, they did not receive time-and-a-half pay. Instead, their weekly hours were split across two paychecks. One came from Michael Bianco. The second came from its sister corporation, Front Line Defense, Inc.. Both businesses reportedly shared the same building, equipment, team, and supervisors.

Statements From Worker Advocates

Attorney Greater Boston Legal Services leads the worker representation with help from South Coastal Counties Legal Services. The legal team also includes managing partner Philip Gordon from Gordon Law Group, providing services in a pro bono role.
Senior attorney Audrey Richardson stated the company created a fake separation between the businesses. She explained that both corporations operated as one employer in practice. Attorney Ingrid Nava added that many workers earned minimum wage or close to it. She also stressed that workplace fairness protects all workers, regardless of status.

Time Deduction and Rounding Practices Under Fire

The filing also challenges the company tardiness policy. Workers lost 15 to 30 minutes of wages for arriving one minute late. This happened even when long clock-in lines caused the delay. Workers also waited to punch out, but they weren’t paid for that time either.
Advocacy director Phillip Kassel, speaking for South Coastal Counties Legal Services, said the company kept large sums that should have paid low-wage families instead.

Community and Legal Collaboration

The case was filed in partnership with the Organizacion Maya K’iche, a local worker support organization led by director Anibal Lucas. He said workers only wanted fair treatment and stable income.

The Immigration Raid That Triggered Worker Claims

In March 2007, a federal immigration raid hit the Michael Bianco factory. It resulted in arrests, family hardship, and a community support crisis. But wage violations reportedly affected all workers, not only those detained.

Why This Case Matters for Wage Law Enforcement

The lawsuit highlights how misdirection can block worker rights. The case also pushes companies to follow real payroll rules, real overtime calculations, and fair time recording. Most importantly, it pressures employers to treat compensable time as paid time.

✅ Rights Workers Can Reclaim If the Case Succeeds

• Full hourly wages for missed compensable time
• Time-and-a-half overtime premiums for excess hours
• Repayment for illegal minute-late deductions
• Compensation for unpaid clock-out waiting periods
• Possible multiple damage awards based on unpaid wage value

The Hon. Deval Patrick, Governor
Office of the Governor
State House
Boston, MA 02133

RE: Effort to Clarify the Massachusetts Wage Act

Dear Governor Patrick:

I wrote to you in December 2006, as you were assembling your transition team, about a piece of bi-partisan legislation that passed both the House and Senate without objection and had been vetoed by Governor Romney in his final days in office. The bill garnered unanimous support in the Legislature, and the Governor’s veto would likely have been overridden had the bill not been enacted during informal legislative session under rules that preclude veto overrides.

The good news is that the House and Senate have enacted the exact same piece of legislation again, and it is finally on your desk. The legislation is S.1059. It is important legislation – important to our workers, who depend upon their wages, important to the state, which depends upon the tax withholdings, and important to our businesses, which depend on an environment without competition from other businesses who neglect to pay their employees. It is the reason for this letter.

Failure to pay employees their earned wages in a timely manner is a serious problem. It injures employees, undermines our competitive economy and deprives the Commonwealth of revenue. It is an act with serious consequences, especially for employees, and it warrants triple damages.

Employers hire their employees, set the wage rates, set the hours and know when wages are due. Without mandatory triple damages, irresponsible employers can delay payroll, leave their employees without needed paychecks, underbid honest competitors, damage the Commonwealth’s support systems and then pay single wages late, without any compensation to employees for their losses.

Some might say that automatic treble damages are punitive in nature and should not be imposed on companies who make “honest” mistakes. But, this mischaracterizes the legislation. Treble damages are not punitive in nature. They are liquidated damages. They are not intended to punish, but rather they are tied strictly to the wage itself and intended to compensate employees for their losses.

As you know, punitive damages are determined by focusing on the company. They are meant to punish the corporation. But this form of treble damages are focused on the employee and tied strictly to the actual unpaid wage amount, an amount roughly determined to compensate an employee for her losses.

As for the concept of “honest” mistake, this too mischaracterizes the intent of this legislation. Employees suffer greatly without their wages. One can only recover treble damages after going through a process of filing a complaint with the Attorney General, waiting up to 90 days, then filing a case in court and proving that the employer failed to pay wages. Only then, would an employee be entitled to treble damages, and only for those wages she could prove were still due. Most, if not all, “honest” mistakes would be cleared up long before then. So, the term honest mistake really means careless employer, and no employee should suffer the damages of such carelessness without compensation.

For those who propose amending the statute to change the standard from “evil intent or reckless indifference,” to “willful,” they too miss the point of this legislation. “Willful” failure to pay wages is a crime punishable by imprisonment and fines under MGL c. 149, §27C. The pending legislation is not criminal legislation, rather it is designed to compensate employees for their loss.

The pending legislation ensures proper interpretation and application of the Wage Act so that employees, employers and the Commonwealth are protected. It seeks to undo a recent decision by the Supreme Judicial Court which constricted the original intent of the legislature and made triple damages discretionary. Wiedmann v. The Bradford Group, Inc., et al., 444 Mass. 698, 709-710 (2005).

Since the passage of the private right of action for wage violations, and the addition in 1993 of the “including treble damages” language (M.G.L., c. 149, § 150), as well as the introduction of criminal penalties for non-payment of wages, (M.G.L., c. 149, § 27C), the Massachusetts Legislature has impressed upon employers that failures to pay wages will be taken seriously. The intent was to keep regular wage payments from turning into negotiated events and to compensate employees for their losses in those cases. Thus, if a company failed to pay an employee, the employee could sue under the Wage Act and recover triple damages, costs and attorneys fees, and most courts held such damages to be mandatory. However, in 2005, the Supreme Judicial Court in Wiedmann disagreed, and interpreted the Wage Act as requiring the employee to show that the employer’s failure was “outrageous, because of the [employer’s] evil motive or his reckless indifference to the rights of others.” A tough burden.

S.1059 seeks to restore the original intent of the legislature.

To understand the need for this legislation, speak to our working class families. Many often live pay check to pay check, and are devastated when their earned wages are withheld. Careless or irresponsible employers who promise but fail to pay wages, undermine the ability to pay rent, student loans, taxes, health insurance premiums, medical care, tuition, car payments and groceries – for which anything less than multiple damages could never compensate. Such non-payment also creates a ripple effect throughout each family’s economic health and through the commercial entities which rely on promised payments.

Moreover, there simply is no excuse to justify the far reaching effects of missed payrolls with the institution of payroll services, easy to use computer programs, accountants and plenty of other ways to make sure employers never miss payments – many of the same systems that ensure proper withholdings for state and federal tax payments. In recognition of this, the Legislature has long given working people the right to timely payment of wages, and until Wiedmann, the law provided strong protections to compensate employees for those losses and motivated employers to make timely payments.

The SJC’s ruling in the Wiedmann case weakened the Wage Act to the detriment of all. Despite the fact that the Wage Act’s damage provision is tied strictly to the actual wages due, the SJC nevertheless created a giant loophole for unscrupulous employers to legally avoid paying their employees. This imposes a chilling effect on individuals who now find it difficult to engage an attorney to represent them through the SJC’s new “intent” hurdle – exactly the group of workers the statute was designed to protect. Employers now simply use their spending power on attorneys hired to create doubt and argue “innocent” intent, while dragging a case on for years and making it extremely difficult for an employee to recover or to even hire an attorney at the outset to represent them.

The Wiedmann decision also subverts the marketplace. Up until the SJC ruling, the vast majority of judges interpreted the statute to require mandatory treble damages, and during the decade plus years the law was in effect, there was no outcry from the general business community or from employers who were found at fault for not paying their employees. That was simply because the vast majority of employers treat their employees fairly and pay their employees all amounts due on time, both because of the law and because employers recognize the importance of employee retention. Thus, it was only those employers who repeatedly violated the rights of employees, created climates of distrust and refused to provide redress, who found themselves subject to the provisions of the statute.

S.1059 is also a natural and important extension of the General Court’s recent focus on wages, health care and corporate tax loopholes, because the bill serves to enforce provisions of the law that guarantee that every worker in Massachusetts (minimum wage earners and beyond) be paid for their work.

Clarifying the Wage Act is beneficial to employers as well. When a company fails to pay its employees proper wages, it can utilize the illegal “savings” to underbid its competition or lower the costs of its products or services. Especially for small businesses, the ramifications from dishonest competition can be devastating, an unfair result to those businesses abiding by the law. This legislation squares with a concern raised by the business community that General Court set to address in the context of health care reform, namely that businesses (through higher premiums charged by insurers) and government (via the uncompensated care pool and Medicaid) were subsidizing employers who could, but didn’t provide health care to their employees. Thus, the legislation would similarly level the playing field for all businesses in Massachusetts by prohibiting businesses from using payroll funds to underbid their competitors in the marketplace. It is important to keep in mind that this proposed change in the law has no bearing on employers who follows the law and pay their employees when their wages are due- period.

It is for that reason that, in addition to having bipartisan support of members on the Labor and Workforce Development Committee, the bill had remained consistently unopposed by key business groups. These business organizations pride themselves on having members who value the importance of paying wages in full and on time and responsible business owners interested in a level playing field, where they won’t be underbid by unscrupulous competitors who fail to pay their employees. Although it is our understanding that some of these organizations have begun to wage a more concerted effort in opposition, none of these groups have testified openly before any of the committees that have considered the bill.

I appreciate the opportunity to call this effort to your attention and to be of any assistance that I can to both you and the rest of the Patrick-Murray administration. Of course, please let me know if you have any questions or comments. I look forward to working with you.

Very truly yours,

Philip J. Gordon

In Chao v. Hotel Oasis, Inc., the First Circuit Court of Appeals held the president of a corporation personally liable for the corporation’s FLSA violations. Prior to imposing personal liability, however, the Court determined that it is necessary to undergo a personally liability analysis to consider whether the corporate officer was “principally in charge of directing employment practices, such as hiring and firing employees…thus instrumental in “causing” the corporation to violate the FLSA.”

This has long been the rule in Massachusetts, where the Wage Act names the President and Treasurer as having personal liability for non-payment of wages. Now it appears there’s similar liability under Federal law, too.

The ruling is important for employees of companies where executives attempt to use bankruptcy threats to deprive employees of wages. Now, they are personally liable, too.

The Secretary of Transportation has long held the authority under the Motor Carrier Act to regulate the maximum hours for drivers of light-weight vehicles. In light of that power, Congress included the Motor Carrier Exemption under FLSA to exempt small truck operators from the overtime requirements of FLSA, so as to avoid conflicting with the Secretary of Transportation’s authority. But neither the Secretary nor the Federal Highway Administration ever exercised that power, choosing instead to focus on maximum hours of operation for medium and large vehicles. This effectively deprived light-weight vehicle drivers of any hours-of-work protections and left the public with greater exposure to the dangers of over-worked small trucks.

SAFETEA-LU corrected that anomaly in 2005 by restricting the Secretary of Transportation’s reach under the Motor Carrier Act. SAFETEA-LU redefined “motor private carrier” under 49 U.S.C. § 13102(15) to be more in line with the Secretary of Transportation’s actual efforts to cover only persons transporting property by “commercial motor vehicle” under 49 U.S.C. § 31132(1), vehicles with a weight of at least 10,001 pounds. This brought the light-weight vehicle operator finally under the protection of FLSA.

But pending legislation could strip away this protection. H.R.5576 was reported out of the Senate Appropriations Committee on July 26, 2006 with language to strike the word “commercial” from in front of “motor vehicle” and treat the provision as though SAFETEA-LU had not been enacted. This would return power to the Secretary over the light-weight vehicle class, and thus likely leave those drivers once again without protection. Whether or not this legislation passes, it clearly will affect many truck drivers and their employers in Massachusetts and states nationwide.

Of course, Massachusetts law remains unchanged, exempting from overtime all drivers and helpers on trucks, and should be considered in evaluating any overtime claims.

In the meantime, if you drive a light-weight vehicle (less than 10,001 pounds) and your employer fails or refuses to pay you overtime, give us a call.

From the interview:

Armstrong: “Can you explain what this new wage and labor bill sets out to do?”

Gordon: “The bill puts the teeth back into a 1993 law protecting wages that was the subject of a controversial decision by our state supreme court last summer. The bill requires employers who skip payroll to pay those employees 3 times the amount of the missed wages. The problem is that when employees miss their wages, they have tough decisions to make about paying rent or mortgage, medical care, taxes, food, tuition. The idea is not to punish employers for missing payroll, just to compensate employees for their suffering.”

Armstrong: “What types of compensation does it cover?”

Gordon: “It covers wages. That’s really just about anything an employee earns – hourly pay, salary, commissions, bonuses, benefits, vacation, overtime.”

Armstrong: “What about employers that make an honest mistake?”

Gordon: “It’s tough to make a mistake with payroll. You hire the employees, you set their hours, you set their pay rate, and you know when payroll is due. If you take it seriously, how do you mess that up? But, let’s say you somehow missed a payroll. Most employees won’t file a lawsuit if you apologize and make it up. Keep in mind that to get the triple damages, the employee has to file a law suit.”

While existing laws protect workers against employers who unjustly withhold wages, a level of ambiguity may allow compensation compliance problems to persist – no small problem considering the Attorney General’s Fair Labor and Business Practices Division receives thousands of employee complaints per year.

“This bill clarifies and strengthens the laws, so there are no more mistakes regarding treble damages,” explains Philip J. Gordon, a supporter of the bill and a specialist in wage and labor laws at the law firm of Gordon Law Group, LLP, who testified on behalf of the legislation. “It’s important not forget the rationale behind multiple damages,” Mr. Gordon continued. “It’s a serious problem when employees aren’t paid – missed rent, student loans, tax payments, mortgages, health insurance premiums, car payments, groceries. Anything less than what this bill provides leaves them very short.”

“Being tough on crime includes being tough on employers who don’t pay wages in a timely way, also a criminal offense,” states Rep. Paul Loscocco (R- Holliston), one of the principal authors of the language in the bill. “This bill represents a bi-partisan effort to clarify that there’s strong and strict recourse against businesses that don’t pay their employees. My hope is that it will help educate employees about their rights as well as deter businesses from non-compliance,” he continued.

“The judges certainly have the responsibility of making sure trials are done in a fair manner and in rendering verdicts in non-jury trials,” said Rep. Michael Rodrigues (D- Westport), Chairman of the Committee on Labor and Workforce Development. “But when it comes to damages for wage violations, there should be no loopholes. Otherwise, what’s the disincentive for an employer? For the sake of every employee in Massachusetts who may at some point become the victim of an unscrupulous employer, I hope the Governor will sign this bill into law.”

“It’s also good for business,” Gordon continued. The bill has remained consistently unopposed by key business groups such as Associated Industries of Massachusetts (AIM), which prides itself on having members who value the importance of paying wages in full and on time. “Many businesses suffer from dishonest competitors who cheat their employees and use the payroll savings to underbid their competitors,” Gordon stated. “This legislation levels the playing field, so law abiding businesses are no longer disadvantaged by paying their employees. It’s a win, win.”