New Massachusetts Legislation Affecting Employers Minimum Wage and Rights for Domestic Workers

Massachusetts Governor Deval Patrick has just signed one bill and is poised to sign a second that will have a significant impact on some Massachusetts employers.

Minimum Wage

On June 26, the Governor signed legislation that will increase Massachusetts’ minimum wage from its current $8.00 per hour to $11.00 an hour by the year 2017, the highest state-wide minimum wage rate in the country and a full 50% higher than the federal rate.  The move surpasses Vermont, which approved a raise in its minimum wage two weeks ago, bringing it to $10.50 per hour by 2018.  Washington state previously had the highest state-wide minimum wage, at $9.32 per hour.

The good news for employers is that, as a compromise for increasing the minimum wage, the Legislature also included a provision in the bill that freezes the rates for unemployment insurance this year at 2013 levels, and lowers them slightly in 2015, 2016, and 2017.  Currently, Massachusetts has the fourth-highest unemployment-insurance cost, with companies spending $714 per employee, on average.  This change should help to mitigate the impact of the wage increase.

The increase in the minimum wage will take place in three steps, beginning January 1, 2015, when the rate will increase to $9.00 per hour.  Ten other state legislatures have also passed minimum wage increases, including neighboring states Connecticut and Rhode Island.

Rights and Protections for Domestic Workers

On June 19, the Legislature sent a bill to the Governor for signature that will greatly impact the rights of domestic workers.  The bill, which would take effect on April 1, 2015, extends labor standards and protections to domestic workers, strengthening their rights to sleep, rest and meal breaks as well as privacy rights.

Under current law, domestic workers, including nannies and house cleaners, must be paid minimum wage, overtime, unemployment compensation and workers’ compensation, and employers are restricted from deducting more than the cost of food and beverages consumed on the employer’s premises.  Current law also places some restrictions on an employer’s ability to deduct the cost of lodging.

Privacy Rights and Break Times

The new legislation requires that employers respect a domestic worker’s privacy rights, including telephone calls, and specifies that violations of privacy may constitute trafficking of a person. Workers who believe they have been subjected to either verbal or physical harassment or discrimination, whether sexual harassment or based on another protected class, will be eligible to file a complaint with the Massachusetts Commission Against Discrimination.  In addition, the bill clarifies that working time must include sleep, rest, and meal breaks unless the worker is clearly off duty and able to use the time for purely personal activity, either on or off the premises. When an employee works 24 consecutive hours or more, all meal times, rest periods and sleeping periods would be considered working hours. The bill also specifies that, if both the employer and employee agree, the employee may choose not to take an eight-hour sleep break during a 24-hour shift.

The new bill specifies that domestic workers are required to have 24 consecutive hours off for each 40 hours worked in a week and  48 consecutive hours off every month; when possible, the time should allow for religious observance. Employers would be required to pay overtime wages to domestic workers who are required to work on their designated rest days.  As is the case with other workers, full-time, female employees would be eligible for maternity leave.

Provisions Affect Termination

The legislation significantly impacts an employer’s ability to terminate a domestic worker.  If the termination is without “cause,” the employee must receive written notice and either 30 days’ lodging, on or off the premises, or two weeks’ severance pay.  The bill does not extend protection to “casual workers,” i.e., those who only work in a home intermittently.  Staffing agencies, employment agencies, and placement agencies are also exempted under the bill.

Recordkeeping and Providing Information

Finally, under the new legislation, if a domestic worker is employed for at least 16 hours a week, the employer will be required to keep records of the amounts paid, plus details of sick days, time off, health insurance and other matters. Employers will also be responsible for providing information about state and federal laws that affect employees, including their right to collect workers’ compensation, overtime pay and to take time off.  The state Executive Office of Labor and Workforce Development will be developing a plan for outreach to domestic workers for whom English is not their primary language, and the state Attorney General will be posting information about domestic workers’ rights on its website in an effort to further spread the word.

The Massachusetts AFL-CIO has stated that there are more than 67,000 domestic workers in Massachusetts, and the union has been a strong supporter of this bill.  Similar legislation has also passed in California, Hawaii and New York.

If you have any questions about either of these new pieces of legislation, please contact any of the attorneys at Skoler, Abbott & Presser, P.C .