Massachusetts Wage Act Claims for Unpaid Bonuses Dismissed
A recent Massachusetts ruling regarding unpaid bonuses is extremely important for employers in light of the wave of litigation involving the Massachusetts Wage Act. In this case, Plaintiff brought claims under the Massachusetts Wage Act for unpaid bonuses under ERISA, alleging that her former employer deprived her of guaranteed bonus payments.
This case is of particular interest as it is rare for a court to consider the substantive nature of a case during the dismissal stage. However, in this case, the judge ruled on the substantive nature of the wages Plaintiff claimed, outside of the purview of a typical motion to dismiss decision. The court decided that the compensation of a bonus under ERISA is “discretionary or contingent upon the employee remaining with the company [and] is not considered a wage subject to the wage act” and dismissed the claims of unpaid wages, only allowing the retaliation claims to proceed. The judge found that bonuses did not constitute wages as they are not earned.
This decision can help to decrease employers’ concerns about wage claims, particularly those related to bonuses and deferred compensation.
If your business has any questions on this topic or any other matters, please do not hesitate to contact the attorneys at The Royal Law Firm at 413-586-2288.

