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Supreme Judicial Court Rules on Releases of Wage Act Claims 12/19/2012

Posted by Morse, Barnes-Brown Pendleton in Employment, Legal Developments.
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Employment Attorney Scott ConnollyBy: Scott J. Connolly

The Massachusetts Supreme Judicial Court (SJC) issued an opinion this week in Crocker v. Townsend Oil Company, Inc., a case that offers important guidance to employers concerning releases by employees of claims under the Massachusetts Wage Act.

A release of Wage Act claims will be enforceable, the SJC held, only when such an agreement is stated in “clear and unmistakable terms.”  In other words, the release must be plainly worded and understandable to the average individual, and it must specifically refer to the rights and claims under the Wage Act that the employee is waiving.

Crocker underscores the importance for employers of proceeding carefully when paying employees extra compensation, such as severance pay, at the time of termination to obtain releases of claims under the Massachusetts Wage Act.

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