If you employ people in Massachusetts, the rules you’re expected to follow are often more detailed, and more strictly enforced, than in many other states.
Problems with employment laws rarely start with bad intent; they often start with confusion. Maybe it’s a missed detail about final paychecks or a worker you classified as a contractor when they should have been an employee. By the time you realize the mistake, you could be facing an audit or a lawsuit. Don’t wait to learn the hard way.
If you have employees—regardless of company size—you’ll want to watch this webinar.
This eye-opening conversation with employment attorney Amanda Thibodeau of Prince Lobel Tye LLP will explain what you need to know to keep your business out of trouble.
Just a few of the topics discussed include:
- Wage & hour rules: pay frequency, final pay, PTO, overtime, vacation
- Paid leave requirements: family leave, sick time, protected absences
- Worker classification: the ABC test for employees vs. contractors
- Pay transparency & equity: job postings and pay decisions
- Workplace accommodations: when required, what’s reasonable
- Non-competes & restrictions: what’s changed, what still applies
Don’t wait for a mistake to teach you the rules. Register now and protect your business before something goes wrong.
*Disclaimer: The content of this webinar is intended for informational purposes only and does not constitute legal advice. Although the webinar will be co-hosted by an attorney, participation in this event does not create an attorney-client relationship. For specific legal advice related to your situation, please consult with a qualified attorney.
Guest Panelist: Amanda Thibodeau | Partner, Prince Lobel Tye LLP
Amanda E. Thibodeau is a partner in Prince Lobel’s Employment Law group. Amanda has been named to the Massachusetts Super Lawyers list since 2015 in the area of Employment & Labor Law.
This webinar was recorded live on February 24, 2026
Session Transcript:
Jeff Plakans:
Hey, happy lunchtime everybody. This is a Massachusetts Employment Law Hot Topics discussion today. We do this one every single year, and if you’re on, you’re from Massachusetts, it’s going to be lunchtime. But I’m betting you spent the better part of the last 24 hours digging out from the snow that you received.
Speaking of bad weather. Every year in Massachusetts it’s bad weather when it comes to employment law. If I had a dollar for every time we talk to a client who said, “I don’t know what I don’t know when it comes to my employees,” not only would we not need to work, but obviously we wouldn’t have a company. But we do. And today’s focus is to help make sure that you guys know what you’re supposed to know. We do this one every single year because the law is a living, breathing, changing complex thing. It changes every year, what’s happening around it changes every year, and we’re lucky to have an old friend of the organization, Amanda Thibodeau from Prince Lobel Tye. Amanda, thank you for joining us today.
Amanda Thibodeau:
Thank you for having me. Excited to talk about all things hot employment law today.
Jeff Plakans:
Amanda is going to take us through everything that we need to know about employment law and what we need to know about Massachusetts. So let’s dig into it. Of course, myself, for those of you who don’t know me, I’m Jeff Plakins, I’m the founder and I’m the president of Commonwealth Payroll and HR. If you’re new to Commonwealth’s Content, well welcome. And if you’re already a client, we appreciate it.
Couple things, if you have questions, we’re going to have a opportunity for questions at the end of the session today. There is a questions and answers box right on the screen there so you can go ahead and submit your questions that way. Feel free to use the chat all you want. Note how many years I’ve put on and whatever, that’s great. Questions, please put them in the questions to make sure we get to all of them. And let’s get started, Amanda.
Amanda Thibodeau:
All right.
Jeff Plakans:
Now, our best clients come to us after they’ve written that big check. We know that big check can really hurt and it really comes like a sucker punch. You just don’t know, as I mentioned, what you don’t know. So our goal today is to make sure that you don’t have to write that big check. Amanda.
Amanda Thibodeau:
Thank you, Jeff. I always like to start off with this slide. It’s a little light, a little bit of a joke to sort of showcase what compliance can feel like sometimes. When you are in the thick of your HR issues dealing with employee problems or new law has come out and you feel like you don’t know what you know, as Jeff said, this is what it can feel like, you are just trying to bail out a sinking boat with a Dixie Cup.
When we say the word compliance, it can feel a little scary, it feels very official. But really what we just mean is that we are making sure that we are complying with as many laws as we possibly can. Which ones are the most important? Sometimes we have to prioritize things because we understand that in the business world, things aren’t going to go perfectly all the time and you may not have all of the resources to be a hundred percent perfect, but we will get you there as closely as we can. Jeff and I are here to help, to make it seem like we’re not dealing with as much water and we’re containing it as well as we can.
So for today, we’re going to talk on quite a few subjects. And as Jeff said, I am going to try to leave some time at the end for questions. We do have quite a bit to cover, so I just want to forewarn folks that a lot of these are just going to be little bites of the updates that we’ve seen over the last year, what to expect in 2026. And of course if you have any larger questions that are going to require some more significant discussion, feel free to reach out to Jeff and I after the program. Happy to walk you through it all.
Our first topic, we’re going to talk about our favorite, which is Wage and Hour compliance in Massachusetts. As an employer side attorney, the Wage and Hour law in Massachusetts is the bane of my existence. It also keeps me in business, as it does with the plaintiff’s bar quite a bit. We have many different moving pieces to worry about with Massachusetts Wage and Hour compliance. And of course, which we’ll talk about a little bit later as well, we also have employees seated everywhere now all across the United States. Thank you to Covid, we have a lot more remote workers, so we have a lot more moving pieces, which makes things very much more complicated.
In our Wage and Hour web, we have to worry about both state and federal compliance. On the state side, we have the Massachusetts Wage Act. A number of issues that we need to worry about there, including final pay laws, frequency of pay, minimum wage, vacation and PTO policies all sort of fit into that state wage act, which has some pretty significant consequences if you fail to comply. Then on top of that, we have a lot of federal standards as well, including our largest one, which is the Federal Labor Standards Act, the FLSA. You’ll hear a lot of alphabet soup today. We have to make sure we’re complying both sets of laws.
We have in that web as well, exempt versus non-exempt classifications, more frequently nomenclature would be hourly versus salary. How do we get there? When can we classify one as the other? Multi-state compliance, as I mentioned. Handbooks and other policies to make sure that we are consistently putting our Wage and Hour practices in writing and performing in that way as well. Independent contractors, how do we classify those folks and when can we. Hiring practices and documents, which all speak very much to, again, those compliance. Are we doing things consistently? Are folks getting information that they need in writing? How can we prevent disputes from happening later over pay, frequency, benefits, things of that nature. Then of course we have our brand new Pay Transparency Act, which we will talk about in some depth today as well. We have the Pay Equity Act in Massachusetts as well, which is not a new law, it’s been around for several years. But they interact in ways that are very interesting and in ways that are going to be very, very important to employers of every size.
For our wage and our compliance, as I mentioned, we have minimum wage. The minimum wage did go up in Massachusetts. We are on a graduated step program right now for minimum wage. Every January 1st, it goes up, so make sure that you are reviewing your minimum wage folks to make sure that you are in compliance with the new rates. Overtime, obviously the minimum wage is going to affect the overtime rates as well. So if you have hourly folks who work over 40 hours per work week, we need to be concerned about paying overtime. Vacation and PTO, those have very specific rules in Massachusetts on how you’re able to utilize those policies, how you’re able to design those policies. And then if you have an employee who’s leaving for any reason at all, they could be terminated or they could be resigning, you need to pay out that vacation time upon their discharge.
We also see commission and incentive plan issues consistently. This goes again to those employment documents that I talked about on the last slide. We want to make sure we are looking at our commission incentive plans, our bonus plans, that they are clear, that everybody understands when things are considered earned and when they get paid out. We see disputes about that frequently, especially for departing employees, “When was my commission earned? I’m owed X number of dollars even though the sale hasn’t closed yet.” All of that should be laid out in your commission plan to make sure everybody understands when those things are earned. That can be a Wage Act violation if you are found to have not been paying out commissions on time.
And of course, our payment of final wages, which I’ve mentioned several times already. If we have a Wage Act violation in Massachusetts, it’s automatically triple damages plus attorney’s fees, costs and interest. This is one that we need to be very careful about, and I’m going to drum this drum consistently during our discussion on the Wage and Hour Act today because we see some very significant consequences for folks. It can take down even larger companies if this is a more systematic problem. So these are things that we need to make sure that we’re paying attention to and we have guidance if we have any questions on this at all.
Independent contractors. I’m going to talk about this just for a few minutes because nothing new has really changed in the law for independent contractors, but what we have seen is an uptick in enforcement from the Massachusetts Attorney General’s office. This has become a very significant piece of their practice in making sure that companies are falling in line, not utilizing independent contractors inappropriately. This is historically a complaint-based type enforcement, however. So if the Attorney General receives a complaint from an individual who either currently performs work for you or maybe has in the past, that’s usually when we see them start to open up and say, “Okay, let’s take a look at your books and let’s see what’s going on here.”
There has been a significant uptick in enforcement activity with the Attorney General’s office. What they look for is especially for industries that employ folks that may be more in more vulnerable populations. So perhaps we have a significant amount of immigrants who are in this particular industry. We see it with students, so internships and things of that nature. We want to make sure that we are taking a look at this every year. It’s a good housekeeping thing to do, to make sure you are reviewing your workforce and that you are using independent contractors appropriately. Massachusetts has one of the strictest independent contractor tests in the nation, along with California, our friends out in California. It’s what we call the ABC test. We have to meet all three prongs of this test. The first is control, worker has to be free of your direction and control. The business, has to have work performed that is outside the usual course of your business. And then customarily engaged, so the individual performs or has the ability to perform work for others as part of an independent business.
This is all very fact-based and it’s going to look different for probably every individual in every business. But these are the three things that you have to meet in order to become an independent contractor. The default is they are employee unless they meet all three. And going back to our fund wage act, this can also be a potential violation of the Wage Act. If you have been misclassifying an individual as an independent contractor when they should have been an employee, they would be entitled to back wages, other compensation that they may have otherwise been entitled to, including value of benefits, tripled, plus attorney’s fees, costs and interest. So again, a very expensive mistake.
Oftentimes we see folks that do not know. They’re not doing this intentionally to try and break the law or to skirt responsibilities. Oftentimes the individual ask, “Hey, can I be an independent contractor? I want to be a 10-99.” We cannot do that if they do not meet this classification. Along with the civil penalties that come along with this directly to the individual, the Attorney general can also tack on additional fees and penalties and potentially criminal time. Take a breath. That’s usually only reserved for folks who are doing this intentionally on a much larger scale. However, it is a possibility.
Jeff Plakans:
This is where those big checks come from, by the way.
Amanda Thibodeau:
Yes, very large checks. We wanted to take a minute to talk about PEOs and the Wage Act and how that interacts as well. And for folks who don’t know what a PEO is, it is an organization, a for-profit business that can be the employer of record. We use this oftentimes, especially for smaller or mid-sized businesses that maybe don’t have a lot of administration help, and they may have employees in other states or other countries, and they need someone to sort of take on the burden of that HR administration for payroll, benefits, things of that nature. And depending on the PEO, they can be a very full service type business. They can offer compensation plans, they can offer payroll directives, they can offer benefits, healthcare and things of that nature.
The pitch used to be that they oftentimes could offer healthcare for smaller businesses on a cheaper level than you just going out into the market because of things we’ve seen over the last year. That’s not always the case anymore. PEOs certainly have a really great role for certain businesses if it makes sense. And if you have any questions about whether or not you’re the right fit, Jeff and I would be great folks to talk to offline about that. But in the meantime, for folks who are thinking about a PEO or who are utilizing a PEO, I wanted to just touch on a significant misunderstanding that Jeff and I often see, which is the allocation of risk with a PEO, especially as it relates to the Wage Act in Massachusetts.
A common misconception is that the PEO is the employer of record, not me. Their name is on this. So if there’s a Wage Act violation, I don’t have to worry about it. Not always true. I should say not really true at all, certainly not in Massachusetts. So even if the PEO is the employer of record for tax purposes. When we look at this, they have a different EIN number, they’re a different entity. There’s no common control. The client or the employer, you, still controls the work generally. You’re the one directing the workers, you’re making that supervision, you’re making the hiring and termination decisions. That’s enough to create liability under the Wage Act aside from who was actually writing the check for their salary or their hourly rate.
In Massachusetts it’s important to note too, that there is individual liability available. The whole purpose of that is so if your business is not doing well and you may be considering filing for bankruptcy and yet an employee says that you owe them compensation, the employee is allowed to go after the president of the company or other decision makers that relate to the payroll in order to be made whole. So there is liability, even if the company may not be on the hook, you, the individual, the owner of the business, may still have liability. Jeff and I talk about this quite a bit in these PEO contracts, we always have some pretty significant identification provisions, which is great. That you want to make sure you have a very strong one to cover these types of issues.
However, nine times out of 10, your employer name is going to be the one on the civil complaint, and then you have to fight with the PEO about who is actually in charge of writing that check to the employee, who’s mistake was it. And you may end up in litigation with the PEO as well, fighting over these identification provisions. So just something to keep in mind, that if you are considering a PEO or if you’re already in one, it’s not a… They like to bill themselves as a, don’t risk for the employer or we take it all on, not always true.
All right, so for our Pay Transparency and Pay Equity Act. This is the big kahuna for 2026 that we want to very much talk about and get our brains wrapped around it.
Jeff Plakans:
This one’s going to be on the test kids.
Amanda Thibodeau:
Yes, [inaudible 00:17:56].
Jeff Plakans:
This is something new that everybody needs to know. That’s one of those, I like to call it a panic topic.
Amanda Thibodeau:
We have 14 states with current Pay Transparency Laws, and 10 with active bills. So this is a huge development in Pay Transparency Laws. It is a trend. We see this quite often. All of a sudden a couple of states get on board with a particular topic and then a bunch of other states decide, “Hey, that sounds like a good idea, let’s build some traction.” Which is great. It offers a lot of great protection for employees, a lot of great employee rights. However, in practice, what we end up with is a large quilt of varying different Pay Transparency Laws around the United States that all are slightly different from the next. Which again, if you’re a smaller employer who has time to sit and read through every bill and make sure that we are complying with every single state’s Pay Transparency Laws.
In general however, all of these laws have some things in common, which are that they require employers to disclose pay ranges in job postings, or upon hire, or when requested by employees. Some require all three, but some states have varying requirements as to what has to be listed in the job posting, if anything. And again, what we’ve seen was these more multi-state problems arising. We had a couple of tricksters a few years ago. Colorado was sort of one of the first ones that decided to do this, so we started to see job postings say, “If you’re in Colorado, you can not apply.” Because the employers didn’t want to have to disclose in the job posting what those pay ranges were. Colorado updated the law said, “You can’t do that.” So now we have, if you have even the option of hiring in one of these states that has a Pay Transparency Law, you will need to comply with their job posting requirements.
Massachusetts has a brand new one. It just went into effect in October, this past October of 2025. Take a breath because the AG has already said that they’re not going to take any enforcement action for at least the first part of 2026, likely not even into the early part of 2027. They’re going to give folks some time to get up to speed, make sure that everybody’s on the same page as to what these postings are going to look like, what the requirements are. We need to make sure that we are disclosing reasonable pay ranges is really the takeaway here. The attorney general is going to be looking at, do we have folks that are trying to skirt the spirit of the law by saying, “Sure, my pay range is 75,000 to 300,000. Somewhere in there, right?” That’s not going to be good enough. Generally what we’re going to be looking for is a reasonable range.
So if you look at your workforce, look at where your folks are for particular roles. If you don’t have employees outside of the 75 to 125 range, for example, do not say that you’re going to pay them 60. Do not say that you’re going to pay them 175. We want to make sure that that range is reasonable. That doesn’t mean that you’re not allowed to hire outside of that posted range. We just need to make sure that if you are in fact going to do that, you better have a real good documented reason for doing so. And it could be down to location, it could be education, it could be anything related to time spent in certain industries. There are legitimate reasons for going outside of that range, but generally speaking, we want to make sure we are being thoughtful about creating that range so that it is representative of what you would potentially pay to that applicant if they were hired.
We’ve already seen some creative versions of compliance with this law as we’ve been coming into the last couple of months. I did see one not too long ago where the employer said, “Sure, if you want to see our reasonable job range, go to salary.com and type in Boston, Massachusetts and this job title.” Cute, but not going to work. That is not going to be compliant with the new Pay Transparency Law. Part of me wanted to ping them and say, “You need a good employment lawyer to clean this up.” So make sure that you are looking at these job postings, making them reasonable. And as part of that, again, the whole spirit of this law is to give more information and more power to employees so that they understand when they’re applying what they could potentially be paid, what is their compensation going to look like.
This also gives them the power to see if they’re being underpaid. If you have a long-term employee who you’ve given maybe a cost of living raise every year, but they’re still making $60,000 a year, but you reasonable pay range that you’re listing for that job is starting at 75, they’re going to have questions for you. So this is also a very good opportunity to do an audit of your compensation practices, make sure folks are being treated fairly and equitably under our Pay Equity Law. There’s a couple of components. Again, the Pay Equity Law is not new, but the way it’s interacting with the Pay Transparency Law is really going to bring it into focus this year. Under the Pay Equity Law, we’re not allowed to ask about previous salary. You can’t ask an applicant, “Well, what were you making at your last job?” That’s a no-no. If they offer it up, that’s fair game, but you are not allowed to ask that and require that they answer.
So we have that piece of it, but then we also have the making sure that folks are being paid commiserate with their experience and their level. We do these audits quite a bit and if you have 10 employees who all have very similar job descriptions, they have similar job duties, and yet their ranges are all over the place in terms of high low, you might have some pay equity issues in which you might have men or women saying, “Hey, why are eight of the women being paid more than these two men?” Or flip-flopped. That is going to cause other issues. There is a private right of action under the Pay Equity Act. So as these things start to come out to light, employees are going to start questioning their pay in your practices.
A great opportunity with the Pay Transparency Act, to take a look internally. It can seem like a really big job, but what I’ve been telling folks is that just a little, just little bites at a time. As you start to hire for new roles, great opportunity to sit down and look at that particular department, that particular function, whatever it might be. Especially for a smaller business owner, it feels like a monumental task to take on. So little bites. As you are going through the process of hiring or terminating employees, great opportunity to take a few extra minutes, sit down, look at that job description, those job functions, pay practices. What has worked in the past? What are you looking to accomplish in the future? What pay practices are going to get you there?
For our workplace discrimination and harassment, I just wanted to touch on this for a couple of minutes in that we have seen a very significant rise of anti-harassment and anti-discrimination cases in Massachusetts with our friends over at the Massachusetts Commission Against Discrimination. That’s the government entity that is tasked with in taking these complaints from employees and then potentially litigating them all the way through. We have seen a huge increase. This could be for a number of reasons. One is that we have also seen a lot of layoffs in 2025 and when more folks are being terminated, that’s just obviously going to raise the level of risk for more employees who are now out of jobs and are looking to explain why.
We have seen a number of protected categories that have been expanding across the United States as well. Some states are adding in protections for folks who are have reproductive health status, economic status. We’ve seen a rise of states looking to add in political affiliation protected categories as well. Massachusetts does not have that, but we have seen some states trending that way. So again, if you have a multi-state practice, want to be cognizant of this, that some of these protected categories are expanding. Their interpretations, even of our current categories are also expanding. So we want to make sure that our anti-harassment policies, anti-discrimination policies are up to snuff, that we are practicing what we preach as well. Annual trainings, always recommended. Especially for your supervisors, because they can be the first line of defense for these types of cases.
We’ve also seen the rise of AI litigation for folks using AI programs to make employment decisions. I’m sure many folks have heard there’s a ginormous case out in California with Workday right now, where Workday is accused of using AI algorithm that was perhaps unfairly categorizing applicants based on race, gender, and other protected categories. That is still going on. That one’s going to be going on for quite some time. But we’ve seen a rise of legislation in response to AI as well. So if you have a multi-state practice, make sure if you have any AI programs that you’re either looking to use or you’re currently using, that you are allowed to use them in states where you may have applicants there. Illinois, for example, has a brand new one where you have to give notice to folks that you have an AI program that you’re utilizing to make employment decisions So important to keep that in mind.
And at the end of the day, especially what we’ve seen with Workday, is that the buck stops with you, the employer. We talked about shifting liability with the PEO earlier. Same thing. If you’re using these AI products, you need to make sure that it’s being done fairly. You can’t blame necessarily the AI product. You can’t say, “Well, it’s their fault, not me.” At the end of the day, your name will be on that civil complaint. So you need to make sure that the algorithm is fair, that you are double checking. That is what the EEOC, who is the federal version of our Massachusetts Commission Against Discrimination has said, at the end of the day, the employer is responsible for digging into the AI process and doing the checks and balances themselves to make sure that you can trust it.
Our updates in non-competition agreements and other restrictive covenants. This one is always a hot topic for employers. There have been some significant updates in non-competition litigation in Massachusetts over the last year that are continuing into this year as well. As most folks probably know, Massachusetts has a pretty strict non-competition law, which went into effect in 2018, which I can’t believe. It seems like it’s still so young and yet here we are eight years later. We still don’t have a ton of guidance from the courts as to how certain provisions need to operate. We are getting some clarity this year. So we have a couple of cases that we’re watching very closely to see how they bore out. One of which is with our friends at the Boston Beer Company who make Sam Adams. They have a number of employees who had filed suit related to the other me mutually agreed upon consideration provision of our non-competition law.
The way our law is structured is, you don’t get something for nothing. So if you, the employer, wants to subject an employee to a non-competition provision, you need to pay them for that. That could be either through a garden leave provision, which states that they would be entitled to 50% of their annualized salary during the restricted period, which is up to one year. So if you have an employee who’s making a hundred thousand dollars a year, you’re committing to pay them $50,000 over the next year for the privilege of them saying, “Sure, I agree not to work for your competitor.” The other option, the fuzzier option in the law, has been this other mutually agreed upon consideration. What does that mean? Nobody knows. The legislature wrote it in and said, “You’re on your own.” We have been trying to interpret that over the last eight years. Us employment lawyers have been trying to guide folks in a way that seems fair to employees, but also in the spirit of the law to make sure that folks are being fairly compensated for their promise not to work for your competitor.
So in this Boston Beer Company litigation, they were paying folks, I think it was about $3,000 under this other mutually agreed upon consideration saying, “Hey, you agree to sign this non-competition agreement, we’ll pay you $3,000.” They have now filed suit saying, “That is not within the spirit of the law. They should be paying us at least 50%, which is the garden leave, or at least something close to that.” Because why on earth would the legislature say 50% of your annualized salary versus pennies, right? We’re watching that very closely. They just filed suit in December, I believe. So it’s still very new. We probably will not see any decision on this case, maybe not even this year depending on how it goes. But we are watching that very closely because that will give us quite a bit of illumination as to how these provisions will be described later.
We have another lawsuit pending in Massachusetts as well. But this one we took into consideration pretty quickly. And this relates to if you are a larger company that has a parent company, perhaps with some subsidiaries, the courts have said they will throw out the non-competition provision if the employee does not have an agreement with their direct employer. Meaning, if the parent company signs the agreement with the employee, but the employee actually works for one of the subs, not good enough. They throw out the entire agreement. So that one we’re paying very close attention to. That is still going on as well. But that is at least one piece that we have gotten so far out of this non-competition litigation, which is you need to make sure that you have the correct parties as part of your non-competition agreement.
All right. Our leave laws in reasonable accommodations. This has been a really big one that we have seen an uptick over the last year, so I wanted to just set a little bit of framework for what things you need to look at. We have the federal FMLA and then we have the state version, which is the PFMLA, which is the Paid Family Medical Leave Act or on the federal side, the Family Medical Leave Act. They are different, but they’re very similar in a lot of ways. The FMLA only applies to employers who have 50 or more employees generally. There’s a couple of other things, but for purposes of this discussion, if you’re smaller than 50 employees, don’t worry about the FMLA quite yet. PFMLA, however, which is our Massachusetts version, applies regardless, you have one employee in Massachusetts, you are subject to the PFMLA.
What we’ve been seeing is that this interacts quite closely with the Americans with Disabilities Act, the ADA, in which we talk about reasonable accommodations and State Law Equivalents. The ADA is the federal statute, and that applies to employers with 15 or more employees. However, our Massachusetts version has to have six or more employees. So most employers are going to fall under the state law version. What we’ve been seeing quite a bit over the last year and leading into 2026, is that these are interacting in ways that are really challenging employers in their HR folks. Even their seasoned HR folks are sort of scratching their heads because we’ve been seeing an uptick in these types of requests.
So for FMLA, PFMLA, those are your statutes where employees can say, “Hey, I had a baby,” or, “Hey, I am having surgery,” or, “Hey, my spouse is very sick and I need to stay home to take care of them.” These are these leave laws that allow employees to take time off from work. It protects their job while they are out. The PFMLA does provide some paid benefit to it as well, which we’ll talk about a little bit later. But generally speaking, the employee needs to go out on leave for a health condition or to care for someone with a health condition. What happens when that leave runs out, or what happens when they can come back to work, but they need a little extra something? Perhaps they had back surgery and their doctor says, hey, they can go back to work, but they need a couple of extra breaks during the day to stretch their back, do some exercises for PT.
Okay, what do you do? They’re a cashier at your store. You’re busy. You can’t have them taking a number of breaks here. You can’t have them doing yoga in the middle of the cash register. What are you supposed to do?That’s where we see these interactions get very complicated with the ADA. The Americans with Disabilities Act and the State Law Equivalent require us to enter into what we call the interactive dialogue with the employee to say, employee says, “Hey, I have this disability that affects my life and the ability to perform my job. I need you to help me out and give me this accommodation to help or these couple of accommodations to help. Here’s my doctor’s note that says this is what they recommend.”
What I often see is that employers will see that and go, “Oh, I can’t do that. I have to say no, I don’t know what… We can’t accommodate that.” That’s okay. Just because the employee says this is what I need, doesn’t mean that’s the end of the conversation. The end of the law, you’re required to go back and say, “Hey, we can’t make that work, but let’s talk about what we could make work, and you get into a back and forth. It’s a conversation to make sure that everybody feels good about it afterwards. Sometimes that conversation has to end. You’ve reached an impasse and you can’t make it work. But we need to be very careful about ending that conversation too early without putting in a good effort, a good faith effort in order to resolve these types of issues.
So we’ve been seeing a ton of those. A lot more litigation with these types of issues and just a lot more confusion about how these things are interacting. As with the pay transparency, we’ve seen an uptick in leave laws for state law protections as well. The Massachusetts paid family medical leave is still fairly new. We’ve seen a lot of other states jump on board with their State Law Equivalents. So we are seeing more of these interactions as to how can employers comply with these, what do I need to comply with these? What happens if I cannot accommodate a leave any longer? Oftentimes it’s not just the end all be all. There’s other laws that will interact that we need to be able to walk through and make sure we’re not setting you up for writing a big check.
These are some of the other leave laws I just wanted to mention that we need to just be cognizant of. I mentioned the Paid Family Medical Leave Act, the PFMLA. Here’s all of our alphabet soup. The Massachusetts Parental Leave Act, which is different than the Paid Family and Medical Leave Act, although there’s quite a bit of overlap. The Massachusetts Earned Sick Time Law, we see a lot of issues with this arise that employers don’t understand how to utilize it or what their requirements are in order to comply with it. This was updated in November of 2024, so over a year ago, to add in that one of the eligible uses for earned sick leave is to care for yourself or someone else who is going through a reproductive health issue essentially. That has been added as of over a year ago. I’m still running into employers who have no clue that that is a new eligible use.
So updating handbooks, making sure our HR folks and supervisors are being informed of this as well, because that is another ripe area in which the Attorney General is going to ding you. We have our Federal Family and Medical Leave Act, which we talked about FMLA. Then we have other sort of smaller leaves, and not all of these are going to apply to every employer. For example, the Domestic Violence Leave and the Small Necessities Leave are like FMLA, where you have to have 50 or more employees in order to have to comply. However, if you may even be ticking up towards that 50 number, these are things that you want to have on your radar, your Military Leave, Domestic Violence Leave, Jury Duty Leave, Voting Leave, and Small Necessities Leave.
Massachusetts Paid Family and Medical Leave, I just wanted to take a minute just to cover. It is very important. And again, I’ve seen an uptick in litigation in this area as well. We want to make sure that we’re understanding it properly, which is that it covers medical leave for yourself, the employee, or a family member, which is defined in the statute. It’s not just any person there. It has to be a close family member. It also covers bonding with a new child and it covers military related leave as well. In order to be compliant, you have to register with the Massachusetts Department of Family and Medical Leave. They are the ones tasked with administering the program. They act an awful lot like the Department of Unemployment Assistance. They’re the ones who are going to be intaking all of that paperwork. They make the ultimate decision as to whether or not the employee is entitled to leave under the statute.
It’s kind of nice, just like with the DUA, you can say, “Sure, apply for unemployment. I don’t have any part in it, other than if you want to try and challenge it.” They are the ones that handle all the financial piece too. They withhold all of the contributions, and they pay out contributions to the employee as well. Unless you have a private plan, which is another topic. They require you to post notices and provide notices and onboarding to employees as well. So if you have no clue what I’m talking about, we need to chat. It applies to all employers in Massachusetts, which I mentioned before. If you have one employee in Massachusetts, you will be forced to comply with this law.
So length of leave, 12 weeks for family leave, 20 for your own serious health condition, 26 for a covered service member. The department handles the eligibility and determinations. There is a private plan exemption. So if you have a PEO or some other, perhaps a short-term disability company that you like to utilize, they often will offer this private plan exemption service as well. Query whether or not that is better or worse for you. For certain employers, it makes sense to go with the private plan. For others, I’ve seen them switch back into the state-run program because they just find it easier and cheaper to do. But I’ve also seen employees very happy with their private plan, so it really is going to be a question of fit and cost depending on the employer.
Rules around employees providing notice with some flexibility for issues that arise beyond employees control. So for that, what I mean is that the statute does require employees to give some reasonable notice to you when they need to go out on leave, preferably 30. But of course, if for example, in the example where an employee is having a heart attack and they need to go out on leave immediately, you can’t say, “Nope, you didn’t provide me 30 days notice.” There is an anti-retaliation provision, and this is the really specific piece that we have seen a huge uptick in. Terminations when folks are asking for leave, termination as soon as folks get back from leave. It’s not impossible.
We see this all the time where an employee who is previously having performance issues goes out on leave and the employer goes, “Oh, I was just about to terminate them, but now they ask for leave and I can’t say no and I can’t terminate them now.” And that has some truth to it because of these anti-retaliation provisions, but it’s not an impossible hill to climb. It just has to be a very carefully choreographed dance regarding the timeline. We need to make sure that we are comfortable in the space that we are in to say that these termination decisions were made prior to knowing about the leave. The two have to be very disconnected. However, we need to be very secure in that defensible position if you’re going to take that type of action, because these anti-retaliation provisions are very strong and we have seen an uptick in litigation on these types of issues.
Earned Sick Time Law we talked about a little bit, so I won’t go too much into it, but this is the November 2024 issue that I raised previously. Added in, “To care for themselves or their spouse in the event of pregnancy loss or failed assisted reproduction adoption or surrogacy.” That is an allowable way to use your earned sick time law now. So it’s one hour earned per 30 hours worked, up to 40 a year. It has to be paid if you have 11 or more employees. If you have fewer, then you have to provide the time, but you are allowed to have it unpaid.
Americans with Disabilities Act. We talked about this quite a bit earlier or interactive dialogue, so I won’t spend any more time on this. But again, if you have any employee who’s coming back from leave or discloses a disability, this is something that you need to absolutely keep in the front of your mind as to this interactive dialogue. How can we get them to perform the essential duties of the job with or without an accommodation? That is going to be a very fact-specific discussion for each employer and each individual. No disability is the same. No job description is necessarily going to be the same. The challenges are not going to be the same. So these are very fact specific questions that keep me in business. We’ll say that.
I touched on this quite a bit throughout this presentation as well. We have remote and hybrid work issues. Huge uptick in return to work policies over the last year and continuing into 2026. Which means that we’re seeing compliance issues with multi-state issues, which I’ve mentioned as part of this presentation as well. Generally speaking, if you have an employee who is sitting in a different state and performing work for you, that other state is generally going to be the controlling state for purposes of their employment compliance. So if you have an employee sitting in Indiana, Indiana law will control that relationship. There are some exceptions, but generally speaking that’s how we evaluate these. And of course, each of those states has different laws. They have different wage laws, they have different discrimination laws, they have different privacy issue laws, the AI laws that I mentioned, restrictive covenant laws.
We’ve seen an uptick in states with non-competition restrictions. So we want to make sure we are focused on making sure that we’re complying in each of these other states as well. What we’ve been seeing a lot is employers trying to get a one-size-fits-all employment document, especially when it comes to NDAs, non-competition agreements, assignment provisions. I call it my pick-your-own-adventure form, where we say this provision applies, except if you’re in California or Minnesota or… And we list the states because there are restrictions in each of these states as to what language is required as part of an NDA. For example, what you cannot require employees to promise they’re not going to talk about. We’ve seen a few more laws like this come into play. Illinois has a brand new one. So if we have updated employment documents, we need to make sure we are complying with each of those states that you have employees in as well.
And then we have our return to work policies, which we’ve been seeing has contributed to a higher amount of leave requests and reasonable accommodation requests for work-for-home accommodations essentially. Folks who were previously not commuting in are now saying, “I have anxiety about commuting. My doctor has suggested that I continue to work from home on a hundred percent basis.” Been seeing that one at least once a week for the last year, I would say. So again, that’s why we talk about this framework with the ADA. We need to make sure that we are going through that process. We cannot have a one size fits all policy without exception for these return to work issues because of these potentially disability discrimination type issues. We need to make sure we are complying with the ADA in our State Law Equivalents. Folks may have other challenges when it comes to returning to work, so making sure that we are complying within the parameters of those laws and being fair to our employees.
When do we need an employment lawyer? Folks often generally think, “Well, I’m not hiring anybody, so I don’t need to talk to anybody.” Not true. We have hiring, firing, updating of documents, all the things that you would normally think of. Performance management we help with as well, reducing litigation risk. But then we also have, as we just talked about, multi-state issues related to tax and real estate, remote work and multi-state employment issues. If you’re in a specialized industries such as healthcare or cannabis, you’re going to have a separate set of regulations that govern your employment relationship. So not only are you complying with federal and state law now, you also have to comply with your set of regs. Oftentimes we have to deal with that. With background checks for example, and what you can and cannot do. All things that we can help with.
IP and licensing, you don’t normally think of this immediately [inaudible 00:52:28] an employment lawyer. But this is one of the biggest issues that we see, is that the value in knowledge that is in your employees, when they leave or if they want to take you down, they can. If you do not have proper NDAs, non-solicits, non-competition agreements in order to protect yourself, they could be walking out with some really valuable information and causing havoc to your business. So we want to make sure that all of that is buttoned up. It doesn’t mean that they can’t try, but it just means that you have some really good defensible documents that you can go to the court with to try and stop them.
Then of course, everybody has employees, so you always need a good employment lawyer. I always say employment law isn’t rocket science, but it is a people business, which is complicated. It is ever-changing and it infiltrates every part of the business. If you don’t have employees, you don’t have value. In my view, your employees are going to be the most valuable part of your company. I don’t care what your IP is. If you don’t have folks to carry out your mission, you will not be able to survive. So we need to take care of our employees and make sure we are not writing big fat checks.
Jeff Plakans:
All right. Remember what Amanda said. The important thing is to know when you need an employment attorney, you’ve got 50 different states with 50 different sets of payroll laws, wage and hour laws, and all these other things, and it gets really confusing really, really quick to know how to dot your I’s and cross your T’s. One of the things that we’ve done at Commonwealth over the last year or so, has started to include or embed fractional HR services as part of our different service plans. We can help because there’s a lot of overlap where those wage and hour rules and the technology that you use, not just around payroll but around timekeeping, benefit administration and the like. So you want to be able to have somebody that’s going to give you the knowledge to be able to not only do that correctly, but do it within the tools that you’re already using from Commonwealth.
Obviously expert HR guidance, but most of all it’s going to help you make the smart HR decisions that you guys need to make and know when you need to get Amanda involved. And that’s the most important thing. We see too many times employers, because they’re afraid that the dime is going to start as soon as they pick up the phone. Then finally, by the time they get the information that they need, it’s too late. Actions have already happened. If you’re interested in upgrading some of the services that you have with us currently, go ahead and hit this QR code that’ll take you to a page and a form where you can enter in your information. We’ll be happy to get to talking to you specifically about those and of course about getting you in touch with Amanda as well. Although her information will be in another slide or two. Amanda, any last words for everybody?
Amanda Thibodeau:
Well, I have one. Keep calm and call your employment lawyer.
Jeff Plakans:
Excellent.
Amanda Thibodeau:
As I said at the beginning, it can feel very daunting. It can feel like you are in this incurable situation, baby steps. And with the right help we can take a breath and get you on the right track. There’s very rarely something that we can’t fix, but as Jeff said, the sooner you get us involved, the better outcome we can usually get.
Jeff Plakans:
All right, excellent. We do have a small handful of questions, Amanda.
Amanda Thibodeau:
Great.
Jeff Plakans:
So I’ll zip through those. We’ve got three minutes for questions, but we’ll run a little bit over if we can. Now, first question was, doesn’t paid family leave not apply to me if I already have insurance?
Amanda Thibodeau:
That is not true. There are two components of the Paid Family Medical Leave Act, and they can get a little bit confusing. One is the law, which allows folks to take the leave and protects their job. And then there’s the compensation piece. I think that is maybe what is confusing to folks. If you have a short-term disability policy, that’s what in the past has normally compensated employees when they went out on leave so that you, the employer, didn’t have to continue to pay their wages while they were out. The state program allows them to apply directly to the state or to your private plan, and they will pay a portion of their wages for the protected leave that they’re out.
Whether or not the employer wants to supplement that on top so that folks get a hundred percent of their wages, you are not required to do so, but it’s very generous. The short-term disability plan can also work in with the Paid Family Medical Leave Act as well., Again, to top off, so folks are getting a hundred percent. So while you may have a short-term disability plan and that’s great, the requirements under the Paid Family Medical Leave Law are different and distinct, so we need to make sure that we are still complying with the law in terms of allowing folks to take leave for certain issues, the length of leave, anti-retaliation provisions, and job protection.
Jeff Plakans:
All right. Now there was a second question in there. Somebody asked, “Don’t we handle this, meaning Commonwealth?” Yes we do. We will handle the withholding and the calculations and the payment of those taxes to the agencies that require them. Not just for Massachusetts, for any agency that has a Paid Family Leave Act that’s in place. So yes. Yes to that.
New question. Regarding non-competition agreements, Amanda, in our case, we don’t prohibit employees from working for a competitor, but we restrict them from soliciting our current customers. If they change to independent contractors and start their own business, is that permissible?
Amanda Thibodeau:
It sure is. Non-solicitations are outside of the scope of the Massachusetts non-competition law, so they are really not regulated in any sort of meaningful way. We do have common law. So if you were to get challenged in court for your non-solicitation, there are parameters that the courts, as part of case law, in the past have looked at in terms of reasonableness, meaning we look at the time, the place, the length of time. But generally speaking, courts have found non-solicitations, as long as they are reasonable in scope, to be generally permissible. Certainly if you have a non-solicitation for 10 years, that’s going to not be reasonable. But anywhere depending from one to three years, depending on the industry or seniority of the person involved, have been found to be reasonable by courts.
Jeff Plakans:
All right. Two more questions. This is to the independent contractor discussion. It says, “What does work outside the usual course of business mean?”
Amanda Thibodeau:
Good question. Oftentimes I use the example of a furniture business who has hired an accountant, a bookkeeper, if you will. The bookkeeper is not in the business of buying, selling furniture, building furniture. They are in the business of numbers and bookkeeping. So while bookkeeping may be an essential function of the furniture business, because how else are they going to know how much money’s coming in, how much money’s coming out, the accountant is not in the furniture business. This can get very complicated, as you can imagine. This is a very simplistic example.
But we see there’s been lots of case law in the past with sales folks, for example, so companies have had to try and hire a whole sales force as independent contractors. And there is some case law that’s been interpreted saying, sales folks, even though their business is sales, they’re not building furniture, but the business cannot function without you selling the furniture. So the salesperson is in the business of selling furniture, which is the business of the furniture company. So like I said before, these are all very fact intensive type analyses, but generally speaking that’s what we’re looking at. Are you in the core business function of that business?
Jeff Plakans:
All right. Last question. This is a good one I thought too. It says, “In the discussion around AI you use the words, ’employment decisions.’ So if I’m using AI to focus on candidates to talk to, is that considered an employment decision?”
Amanda Thibodeau:
It sure is. It sure is. Sorting applicants, that’s where Workday got in trouble in their litigation. So even from anything from sorting applicants to performance management to how you choose folks who are going to be part of a RIF, a reduction in force, all of those are employment decisions.
Jeff Plakans:
So that’s very, very broad.
Amanda Thibodeau:
Very broad. Again, this is one of those trends where we will start to see more states get on board with AI laws regulating these things. We’re seeing a lot more companies pop up with these products. So with more products, come more litigations with folks challenging them. So we’re sure we will see-
Jeff Plakans:
And likely lots of disclosures.
Amanda Thibodeau:
Yes. This is a hot topic that we will see, not even just in 2026, but certainly over the next few years.
Jeff Plakans:
All right. Well, we’ve been here for an hour and five minutes, lots of questions, good questions all. For those of you who aren’t here or want to know more or to take more away from this, obviously you’ve got my information, you’ve got the HR services link, and of course you’ve got Amanda’s information. We will be sending out this recording or a copy of this recording along with the slides to all of the registered folks, whether they were attendees or not. We know that some of you are still out driving and digging out of the snow.
Just one note, this was meant for informational purposes only, not to be considered as pure legal advice. You have to hire Amanda if you want the pure legal advice. But she’s got a lot of good information, we’re happy to share it with you. Thank you for sharing your day with us today. Have a great rest of the week everybody. Bye-bye.
Amanda Thibodeau:
Thanks everyone.
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