Massachusetts 2023-2024 Regular Session

Massachusetts House Bill H1409 Compare Versions

Only one version of the bill is available at this time.

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1	1	1 of 1
2	2	HOUSE DOCKET, NO. 1070 FILED ON: 1/18/2023
3	3	HOUSE . . . . . . . . . . . . . . . No. 1409
4	4	The Commonwealth of Massachusetts
5	5	_________________
6	6	PRESENTED BY:
7	7	Peter Capano
8	8	_________________
9	9	To the Honorable Senate and House of Representatives of the Commonwealth of Massachusetts in General
10	10	Court assembled:
11	11	The undersigned legislators and/or citizens respectfully petition for the adoption of the accompanying bill:
12	12	An Act protecting honest employers by creating construction private attorney general actions.
13	13	_______________
14	14	PETITION OF:
15	15	NAME:DISTRICT/ADDRESS :DATE ADDED:Peter Capano11th Essex1/18/2023 1 of 8
16	16	HOUSE DOCKET, NO. 1070 FILED ON: 1/18/2023
17	17	HOUSE . . . . . . . . . . . . . . . No. 1409
18	18	By Representative Capano of Lynn, a petition (accompanied by bill, House, No. 1409) of Peter
19	19	Capano relative to creating construction wage theft private attorney general actions. The
20	20	Judiciary.
21	21	The Commonwealth of Massachusetts
22	22	_______________
23	23	In the One Hundred and Ninety-Third General Court
24	24	(2023-2024)
25	25	_______________
26	26	An Act protecting honest employers by creating construction private attorney general actions.
27	27	Be it enacted by the Senate and House of Representatives in General Court assembled, and by the authority
28	28	of the same, as follows:
29	29	1 Add a new section 150D to the general laws at chapter 149, which shall read as follows:
30	30	2 Section 150D Construction Industry Private Attorney General Action
31	31	3 (a)Whereas wage law enforcement and honest bid competition are compelling state
32	32	4interest, its police powers for enforcement shall include, but not be limited to, this section:
33	33	5 a. Construction Industry employment makes more difficult protecting employees
34	34	6against Wage Non-Payment and competing employers against unfair competition based on Wage
35	35	7Non-payment, as employees and employers navigate during single pay-periods multiple
36	36	8construction sites throughout the Commonwealth and neighboring or other states;
37	37	9 b. Most construction firms employ fewer than twelve employees inhibiting
38	38	10employees similarly situated to obtain class certification under court rules; 2 of 8
39	39	11 c. An employer’s failure to comply with wage payment and related law provides
40	40	12competitive advantage that illegally shaves costs resulting in illegally deflated bids to compete
41	41	13against honest employers, and such illegal conduct harms competition including by way of
42	42	14workers compensation insurance premium evasion –affecting insurance rates and causes payroll
43	43	15tax loss to the Commonwealth increasing the public’s tax burdens; and
44	44	16 d. Construction Industry higher tier contractors often contract with the lowest price
45	45	17bidder; and
46	46	18 e. The public is harmed when higher tier contractors subcontract to business
47	47	19enterprises or lower tier subcontractors that cheat to compete by failing to fully comply with
48	48	20wage payment laws and regulations; and
49	49	21 f. The public is harmed when employees lack proper wages on payday, including
50	50	22but not limited to the difficulty for an unpaid employee to meet his or her financial obligations
51	51	23owed to others in the stream of commerce or marketplace causing public harms that include, for
52	52	24example, unpaid rent, mortgages, medical bills and related insurance payments, automobile
53	53	25expenses, and other common living expenses; and
54	54	26 g. The public is benefited when:
55	55	27 i. Construction competition among bidders is based on honest bid competition as
56	56	28honesty promotes competition; and
57	57	29 ii.An Interested Party pursues wage law compliance on behalf of the
58	58	30Commonwealth as it best ensures non-complying construction employers will experience 3 of 8
59	59	31exposure and the consequences when they do not pay their statutory and contractual wage related
60	60	32obligations.
61	61	33 (b)Definitions, for this section 150D:
62	62	34 “Construction Industry” shall have the broadest meaning possible to include but not be
63	63	35limited to drivers delivering construction material to construction sites for employers who
64	64	36primarily deliver such materials, residential contracting services referenced in chapter 142A, and
65	65	37any labor performed on private projects that are of a similar type of labor performed on public
66	66	38projects governed by section 27.
67	67	39 “Construction Industry Employer” means any person who or entity that, within the 5-year
68	68	40period preceding the date an action under this section was filed: i) contracted to perform work,
69	69	41regardless of contract or subcontract tier level, on a project governed by section 27 of this
70	70	42chapter after having submitted a bid for same and who employed employees who performed
71	71	43labor under that contract; or ii) contracted to perform construction work located in the
72	72	44Commonwealth in excess of $500,000, regardless of contract or subcontract tier level, and
73	73	45employed Construction Industry employees who performed labor under that contract.
74	74	46 “Interested Party” means any one or more of the following:
75	75	47 1. Any Construction Industry Employer;
76	76	48 2. Any trustee acting on behalf of an organization or trust established for the
77	77	49purposes of the Labor Management Cooperation Act of 1978, 29 U.S.C. section 175a, where
78	78	50contributions are made by at least five Construction Industry Employers; 4 of 8
79	79	51 3. Any labor organization which has as members, or is authorized to represent,
80	80	52employees and which exists in whole or part for the purposes of negotiating with Construction
81	81	53Industry Employers concerning wages, hours, or terms and conditions of employment of such
82	82	54employer’s employees; or
83	83	55 4. Any organization that represents five or more member firms that are Construction
84	84	56Industry Employers that employed labor on public works project governed by section 27 of this
85	85	57chapter or
86	86	58 5. Any Affected Employee.
87	87	59 “Wage Non-payment” means the failure to pay a wage owed to an Affected Employee in
88	88	60violation of any of the following statutes or contract provision: sections 27, 148, 148A, 148B, or
89	89	61150 of the general laws at chapter 149; or section 1A of the general laws at chapter 151; or any
90	90	62contract provision that required the payment of wages on a construction project in accord with
91	91	63rates required under section 27 of chapter 149.
92	92	64 “Affected Employee” means any Construction Industry employee or former employee
93	93	65who was employed by an individual or firm named as a defendant employer in an action filed
94	94	66under this section where such employee remains due from such defendant any Wage Non-
95	95	67payment whatsoever, regardless as to where or the type of labor was performed, provided that a
96	96	68substantial part of the Wage Non-payment owed was earned by the employee while performing
97	97	69Construction Industry labor as employee of such defendant.
98	98	70 (c)Civil Action: In addition to all common law, contract, or other remedies
99	99	71available at law, an Interested Party alleging facts that show probable cause that an employer has
100	100	72engaged in or caused a Wage Non-payment shall have standing and be entitled to bring an action 5 of 8
101	101	73in the name of and on behalf of the Commonwealth and the public, for the use and benefit of
102	102	74same, against such employer to recover damages and penalties stated in this section.
103	103	75 A civil action filed under this section shall be deemed a private attorney general action.
104	104	76 The representative nature of such an action on behalf of the Commonwealth is not
105	105	77waivable and shall not be deemed a class action, so long as there is at least a common question of
106	106	78law or fact among at least two Affected Employees. Regardless as to whether any Affected
107	107	79Employee’s claim must be arbitrated, the representative action on behalf of the Commonwealth
108	108	80cannot be waived or compelled to arbitration. Further, the Interested Party bringing such
109	109	81representative claim shall not have to wait for an arbitration decision or award before proceeding
110	110	82in court under this section.
111	111	83 The Interested Party filing an action under this section shall provide a copy of the
112	112	84complaint for the purposes of notice to the attorneys general, within 10 business days of the
113	113	85filing. If the Interested Party prevails in the action, the court shall award treble the Wage Non-
114	114	86payment damages, as liquidated damages, to any Affected Employee who has, following a court
115	115	87approved notice of same, responded to the court within 90 calendar days, affirming an interest in
116	116	88a recovery, which notice shall be interpreted liberally to encourage Affected Employees to
117	117	89respond and affirm such an interest. A twenty percent surcharge tax on the total amount awarded
118	118	90by the court-including on attorney fees, in addition to other usual income taxes due, on this
119	119	91recovery shall be paid into a wage enforcement fund established by the attorney general. Such
120	120	92fund shall be used by the attorney general to enforce wage laws, educate the public, particularly
121	121	93employers and employees, about wage law obligations and rights, and when the attorney general
122	122	94deems the fund is sufficiently funded, to advance some payment by loan pending an action under 6 of 8
123	123	95this section and upon the attorney general’s sole and exclusive discretion, to an Affected
124	124	96Employee showing urgent need to obtain unpaid wages to pay housing, heat, or food costs.
125	125	97 In addition, the Interested Party who prevails under this section shall be entitled to
126	126	98recover for the Commonwealth penalties, and Wage Non-payments as restitution incurred by
127	127	99each other Affected Employee who did not respond affirming an interest, as follows: For each
128	128	100violation of law, the court shall order the defendant employer to pay into the wage enforcement
129	129	101fund (i) a penalty in the amount of $50 per violation per pay-period for each unresponsive
130	130	102Affected Employee; and (ii) an amount, payable into the wage enforcement fund, equal to single
131	131	103Wage Non-payment damages, as restitution, incurred for all Wage Non-payments that the
132	132	104defendant employer should have paid to each Affected Employee who did not respond timely to
133	133	105a court approved notice affirming an interest in a recovery; the attorney general shall hold in
134	134	106escrow such amounts until the original statute of limitation period applicable against the
135	135	107defendant employer to expire on such restitution obtained in the event the Affective Employee
136	136	108reconsiders and seeks the restitution. But, after such limitations period has expired with no such
137	137	109employee claim, the amount shall escheat to the wage enforcement fund. A defendant employer
138	138	110ordered to pay into the wage enforcement fund as single Wage-Nonpayment damages restitution
139	139	111incurred for labor performed by an Affected Employee who failed to affirm an interest in a
140	140	112recovery shall be entitled to a set-off of such amount paid against a future Wage Non-payment or
141	141	113other wage action filed by or on behalf of such Affected Employee, but no set-off shall apply to
142	142	114the $50 per pay period penalty. In addition, the Interested Party may also bring on behalf of the
143	143	115Commonwealth a claim for injunctive and declaratory relief. An Interested Party that prevails in
144	144	116any action filed under this section shall be awarded the costs of the litigation and reasonable
145	145	117attorney fees. 7 of 8
146	146	118 An action filed under this section shall be filed within limitation period of the Wage Non-
147	147	119payment at issue, except that where a Wage Non-payment also includes a violation of contract
148	148	120the Interested Party shall be a third-party beneficiary of the contract, including any public
149	149	121procurement contract, and recovery applicable to that portion of the action shall include amounts
150	150	122due within the limitations period set forth under section 2 of the general laws at chapter 260; for
151	151	123such contract action filed beyond the limitation period of the Wage Non-payment at issue
152	152	124liquidated damages shall not be awarded unless the contract recites otherwise and the court may
153	153	125award fees for such contract provision portion of the action in accord with the contract or its
154	154	126discretion.
155	155	127 On the trial no defense for failure to pay as required, other than the attachment of wages
156	156	128by trustee process or a valid assignment thereof or a valid set-off against the same, or the absence
157	157	129of the employee from his regular place of labor at the time of payment, or an actual tender to
158	158	130such employee at the time of payment of the wages so earned by him, shall be valid. The
159	159	131defendant shall not set up as a defense a payment of wages made or offered after the action under
160	160	132this section has been filed.
161	161	133 The superior court shall have jurisdiction to hear an action filed under this section
162	162	134regardless as to the amount in controversy. Any provision in this section found to be
163	163	135unenforceable or invalid shall not affect other provisions in this section which shall remain valid
164	164	136and enforceable.
165	165	137 Attorney General Intervention: As a matter of right the attorney general may
166	166	138intervene as a plaintiff at any time, including post trial, by notice of same filed with the court or
167	167	139may file an appearance to be served all pleadings and discovery for monitoring. In the event that 8 of 8
168	168	140she intervenes, the attorney general shall thenceforth represent the Commonwealth as plaintiff,
169	169	141not the Interested Party. If the Interested Party shall retain party status, if it so chooses, for
170	170	142purposes that may include and not be limited to providing opportunity to the Interested Party to
171	171	143raise its interests or concerns including regarding any settlement proposed or to recover, if
172	172	144appropriate, its reasonable costs and fees incurred. The attorney general shall not settle the matter
173	173	145with the defendant without the participation in all settlement communications with the Interested
174	174	146Party who retained party status and without first obtaining such Interested Party’s informed
175	175	147consent which shall not be reasonably withheld.
176	176	148 Nothing in this section shall be deemed as an exclusive remedy and this section shall not
177	177	149affect the rights of the attorney general or any other person to pursue additional or other remedies
178	178	150available by way of other laws or available actions.