© 2025 Seyfarth Shaw LLP Massachusetts Wage & Hour Peculiarities, 2025 ed. | i Table of Contents Page INTRODUCTION .......................................................................................................................... 1 I. THE MASSACHUSETTS WAGE ACT............................................................................ 2 A. Wages Under Massachusetts Law .......................................................................... 2 1. What Is Included in Wages (and What Is Not)? ......................................... 2 2. Commissions............................................................................................... 3 3. Vacation Pay ............................................................................................... 4 a. Caps and “Use It or Lose It” Policies ............................................. 5 b. General “Leave” Category .............................................................. 6 c. Designation of Accrual Rate ........................................................... 6 d. Unlimited Vacation Policies ........................................................... 7 e. Changes to Vacation Policies.......................................................... 7 4. Earned Sick Time........................................................................................ 7 5. Severance Payments.................................................................................... 8 6. Bonuses ....................................................................................................... 8 a. Discretionary Bonuses .................................................................... 8 b. Formulaic Bonuses.......................................................................... 9 7. Stock ........................................................................................................... 9 8. Expense Reimbursements ........................................................................... 9 B. Frequency and Timing of Payment....................................................................... 10 1. How Frequently Must Wages Be Paid? .................................................... 10 2. When Must Wages Be Paid?..................................................................... 10 3. Payment of Wages Upon Termination...................................................... 11 C. How Must Wages Be Paid? .................................................................................. 11 1. Checks and Drafts ..................................................................................... 11 2. Direct Deposit ........................................................................................... 12 3. Pay Cards .................................................................................................. 12 D. When Are Wages “Earned”? ................................................................................ 12 E. What Deductions Can an Employer Make from an Employee’s Wages? ............ 13 1. Mandatory Deductions.............................................................................. 13
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