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

In 2011, the highest earning executive at Fannie Mae reportedly made $5.3 million, while Freddie Mac’s top executive earned $3.8 million. In 2012, the former FHFA director substantially decreased their annual pay to $600,000.

The argument for increases

According to Watt, salary increases will help attract top talent to opportunities with Freddie Mac and Fannie Mae, as well as retain these individuals as employees. He is reportedly allowing Freddie Mac executives to submit a report regarding desired increases for CEO salaries.

The argument against increases

In response to Watt’s consideration of the issue, Royce responded, “I’m deeply disappointed with Director Watt’s decision to open the door to multi-million dollar salaries at the GSEs, which continue to be propped up by tax payers.”

Under Royce’s legislation, the CEO salaries could reportedly decrease to around $200,000. He is joined in his opposition to the increases by other members of Congress, as well as the Treasury Department.  Fannie Mae and Freddie Mac are currently under a government conservatorship, which was formed under the 2008 bailout, where the two companies received a combined total of $187 billion. At that time, they were placed under the supervision of the FHFA.

If you have questions about your salary or this proposed legislation, contact our office to speak with a trained attorney.

For now, there are currently five bills before the Legislation that seek to eliminate or greatly limit these agreements in the workplace.

• Two bills seek to ban most noncompete and nonsolicitation agreements, while allowing nondisclosure agreements.
• Two bills only seek to ban noncompete agreements, with no consideration to nonsolicitation and nondisclosure agreements. These bills also do not seek to make retroactive changes that would affect previously executed agreements.
• One bill seeks to ban all workplace restrictive covenant agreements entirely and retroactively.

The Massachusetts Joint Committee on Labor and Workforce Development is expected to meet in June to consider the various proposals.

If you have concerns about a noncompete agreement, contact our attorneys today for professional assistance.

This legislation applies to employers with 50 or more workers, expanding protections beyond traditional leave frameworks in cases involving abusive environments or emergency intervention needs.

Permissible Uses of Protected Leave

Qualifying employees may seek leave for:

• Medical treatment and healthcare planning
• Psychiatric care, trauma-informed therapy, or professional counseling
• Filing for or obtaining court-issued protective orders
• Court appearances, hearings, or compliance proceedings
• Law-enforcement coordination or meetings
• Advocacy support involving immediate family members affected by abuse

These provisions acknowledge that abuse-related leave is not limited to physical harm but also includes psychological pressure, legal vulnerability, and family protection needs.

Employer Discretion and Leave Coordination

Under the statute:

• Employees must first exhaust accrued personal, vacation, or sick leave
• Employers may classify the leave as paid or unpaid, at their discretion
• The statute does not supersede collective bargaining agreements or policies that offer greater rights or longer leave benefits
• Leave cannot be denied automatically if eligibility conditions are met

The law aims to balance employer operational needs while preventing misuse as grounds for termination or discriminatory action against abuse victims.

Required Verification and Supporting Documentation

To validate the need for leave, employees may submit one or more of the following:

• Court-issued abuse protection or restraining orders
• Police reports or documented incident filings
• Medical records verifying physical or psychological treatment
• Formal statements from licensed counselors, social workers, legal advocates, or clergy members, signed under penalty of perjury

Employers may request verification only when reasonably necessary and cannot use confidential disclosures as justification for retaliation.

The Massachusetts legislature recently implemented legislation to assist victims of domestic violence with job protection when they require leave from work. The law applies to businesses employing 50 or more workers. It provides up to 15 days of leave during a 12 month period for employees who are victims of abusive behavior.

The leave can be used for the following situations:

• Medical care-giving;
• Psychiatric counseling;
• Securing a court protective order;
• Court appearances;
• Law enforcement meetings; and/or
• Any of these issues pertaining to abusive behavior against members of the employee’s immediate family.

Before taking this leave, the employee must utilize all available personal, vacation and sick leave. In addition, the employer maintains discretion in determining whether the leave is paid or not.

Employee Responsibilities

To prove eligibility for leave under this legislation, the employee must give the employer advanced notice when possible. If unplanned leave is taken under emergency circumstances, the employee’s lawyer, social worker or advocate must provide the employer with a written explanation within three days.

Employees must also provide supporting documentation to prove the existence of a domestic violence situation. This is accomplished with:

• A protective order;
• A police report;
• Medical documentation;
• A legal advocate; and
• Sworn statement from a counselor, social worker, shelter worker or clergy – signed under penalty of perjury.

If you have any questions about the legislation or any other employment leave questions for some reason, 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.

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