Security Deposits: Could They Be More Harmful Than Helpful?

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by Robert P. Rudolph

According to the US Census Bureau, there are nearly one million renter-occupied housing units in the Commonwealth of Massachusetts. It is estimated that 75 percent of rental units are owned by small property owners who do their own management instead of contracting it out. When a new tenant moves in, it is customary for a landlord to collect a security deposit to be used to repair any damage caused by the tenant during the lease. However, many landlords fail to comply with the Massachusetts Security Deposit Law, General Law Chapter 186, Section 15B. In doing so, these landlords put themselves in danger of significant exposure, well in excess of the value of the security deposit.

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Department of Labor Modifies Stance on Obama Era 80/20 Rule for Tipped Employees

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by James L. Rudolph and Robert P. Rudolph

On November 8, 2018 the Department of Labor (“DOL”) issued Opinion Letter FLSA 2018-27 which rolls back the Obama-era’s enforcement of what is commonly referred to as the “80/20 Rule.” Many states allow an employer to pay a lower tipped rate to tipped service employees, such as waiters and bussers. For example, in Massachusetts, the basic minimum wage is currently $11 per hour, but tipped employees can be paid a lower service rate of $3.75 per hour, so long as the sum of the tipped rate and the tips received by the employee equal or exceed the basic minimum wage. In other words, employers receive a “tip credit” of $7.25 per hour.

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An Epic Decision: Supreme Court Upholds Class Action Waivers in Arbitration Agreements

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by Adam J. Shafran

On May 21, 2018, in a highly anticipated 5-4 decision, the United States Supreme Court ruled that class action waivers in employment arbitration agreements prohibiting employees from bringing class action lawsuits are enforceable and do not violate the National Labor Relations Act. The decision in Epic Systems Corporation v. Lewis maintains the status quo and puts an immediate halt to the National Labor Relations Board’s ongoing attempt to invalidate mandatory class action waivers within arbitration agreements. This decision is significant for employers regardless of the state in which they are located.

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Massachusetts Supreme Court Strikes Down Anti-Litigation Provisions in Condominium By-Laws

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by George Georgountzos

A common provision in condominium documents for new construction projects is language protecting the developer from potential lawsuits for defects in common areas and facilities. This limits individual lawsuits by single or minority disgruntled unit owners, but such protections are not limitless. A recent Supreme Judicial Court (SJC) decision, Cambridge Point Condominium Trust v. Cambridge Point, LLC, 478 Mass. 697 (2018), invalidated such a provision that made it virtually impossible for a condominium association to bring suit against the condominium developer.

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Massachusetts’ New Noncompete Law: What Employers Need to Know and Do Before October 1

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by Nicholas J. Schneider

On October 1, 2018, Massachusetts’ new noncompete law (G.L. ch. 149, § 24L) goes into effect. While the new law largely codifies existing common law, it also alters the legal landscape in significant ways that will pose traps for unwary and overprotective employers. Particularly, although the law offers enforceability incentives for narrowly drafted noncompetes, it also makes enforcement more expensive. The statute’s requirements are replete with ambiguous and undefined language that will cost employers time and money as they wait to see how Massachusetts courts interpret and apply the new law’s guiding principles.

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