Employers Beware – Last Day Must be Pay Day for Terminated Employee

Massachusetts employers beware:  when you terminate an employee, you must pay the employee in full on the employee’s last day of work for all accrued wages, including any accrued vacation pay.  Anything less will subject you to triple damages for anything you fail to pay plus attorney’s fees.  This past April, the Massachusetts Supreme Judicial Court held that under the Massachusetts Wage Act, an employer who fails to pay the employee in full on their last day is automatically liable for treble anything not paid plus legal fees.  Reuter v. Methuen, 489 Mass. 465 (2022), applying M.G.L. c. 149, §§ 148, 150.  Liability is strict.  There is no exception or escape hatch.  Accordingly, an employer preparing to terminate an employee should have a check ready to hand the employee at the time of termination.  If for some reason this is not possible, the suggested approach is to suspend the employee with pay until the employer is able to prepare the necessary payment.  Reuter, 489 Mass. at 472.