B&B Founding Partner David E. Belfort was recently interviewed by Massachusetts Lawyers Weekly (MLW) relative to a decision issued by the Massachusetts District Court Appellate Division (Northern District) in Nunez v. Syncsort Inc., et al. (No. 23-ADCV – 63NO) involving whether retention bonuses are considered wages. The appellate panel (Justices: Stark, McGrath & Fabbri, JJ.) held that Nunez, an employee who worked through the dates required of him to earn a retention bonus, but was not timely paid the bonus by Syncsort, did not qualify to recover damages as a ‘wage’ under the Massachusetts Wage Act. Wage Act damages include triple damages, attorneys’ fees and costs.
Approximately four months after assuming the role of Senior Director of Finance with Defendant Syncsort, the Plaintiff in Nunez executed a retention bonus agreement. According to the agreement, the Plaintiff was due a bonus of $15,000 to be paid in two separate installments of $7,500, on condition he worked through certain dates: November 18, 2020 and then February 18, 2021. The Plaintiff received his first installment without issue; however, he was informed in January, 2021 the company was terminating his employment due to a workforce reduction. Plaintiff’s employment was terminated, through no fault of his, on February 18, 2021, the date the second installment of the retention bonus was due to be paid.
Plaintiffs argued the company’s failure to timely pay the second installment was a violation of the Wage act. The employer successfully defended the claim by arguing that the Wage Act did not apply to this retention bonus. Attorney Belfort, who was not involved in Nunez, told MLW that the Wage Act “requires we look past the mere labels for payments” to classify a wage. Attorney Belfort added, “this decision seems to reward employers for labeling a payment as a retention bonus.”
“Here, the employee did what they promised,” Belfort said. “They relied on the bonus in taking the job. They relied on the bonus to stay working through the bonus date, and then they were deprived of the bonus,” through no fault of their own.
Plaintiff’s attorneys indicated they intend to appeal this decision, so stay tuned for further developments.
