Mass-Peculiarities: An Employers Guide to Wage & Hour Law in the Bay State 2022 Edition

© 2022 Seyfarth Shaw LLP Massachusetts Wage & Hour Peculiarities, 2022 ed. | 73 whether the employee is exempt under Massachusetts law or the FLSA, or both. These exemptions are discussed in detail in Section VI. • If an employee is exempt under the FLSA but not Massachusetts law, apply the Massachusetts calculation of the regular rate. • If the employee is exempt under Massachusetts law but not under the FLSA, apply the FLSA calculation of the regular rate. • If the employee is not exempt under either the FLSA or Massachusetts law, apply the calculation most beneficial to the employee, which will generally be the FLSA calculation. 5. Calculation of the Regular Rate for an Hourly Employee Assuming an hourly employee receives no additional compensation, the employee’s hourly rate will constitute his or her regular rate for purposes of overtime payments. Example: An employee’s hourly pay, thus regular rate, is $15.00 per hour. The employee’s overtime rate is $22.50 per hour (1.5 x $15.00 regular rate = $22.50 per hour). If the employee works 50 hours in a week, the employee would be paid $825.00 for the week – $600.00 regular pay ($15.00 x 40 hours), plus $225.00 overtime pay ($22.50 x 10 hours). 6. Calculation of the Regular Rate for an Employee Paid on a Commission Basis Only Because commissions generally may be excluded from an employee’s regular rate of pay under Massachusetts law, calculating regular and overtime rates for employees paid on a 100 percent commission basis can be problematic. In 2019, the SJC held in Sullivan v. Sleepy’s LLC , that commission-only employees are entitled to a separate and additional amount of at least one and one-half times the minimum wage whenever they work more than 40 hours in a workweek. 411 The Sleepy’s decision rejected the analysis of a 2003 DLS opinion letter which had stated that commission-only employees must receive total compensation for each week of work that equals or exceeds what they would earn if they were paid hourly at the minimum wage rate. 412 Thus, an employer cannot rely on commissions or draws against commissions alone to satisfy the overtime pay requirements. 411 Sullivan v. Sleepy’s LLC , 482 Mass. 227 (2019). The SJC explained that this analysis also applied when retail employees are ent it led to premium pay for work on Sunday. 412 DLS Opinion Let ter MW-2003-004 (Mar. 14, 2003).