This week, the Supreme Judicial Court of Massachusetts concluded Massachusetts Wage and Hour Laws prohibit an employer from setting-off damages arising from an accident against the wages of employee drivers, even if the employee drivers agree to the wage deduction in writing. Camara v. Atty. Gen., SJC-10693, 2011 WL 198644, at *4 (Mass. 2011). In Camara, a policy of a disposal service required employee drivers unilaterally determined by the disposal service to be at fault in accidents to either accept disciplinary action or enter an agreement to set-off the damages against their wages. While Massachusetts Wage and Hour Laws allow “valid set-off[s]” against wages, the court concluded damages arising from an accident do not constitute a “a clear and established debt owed to the employer by the employee,” the only type of debt which gives rise to a “valid set-off” under M.G.L.A. 149 § 150. Id. (citing Somers v. Converged Access, Inc., 454 Mass. 582, 593, 911 N.E.2d 739 (2009)).
In light of this finding, caution is warranted prior to setting-off wages in Massachusetts. Employers should review any agreements in place with employees related to set-offs and ensure any set-offs against wages are clear and established debts owed to the employer.