Mass. AG settles over vacation wages

By Bryan Cohen | Mar 28, 2012


BOSTON (Legal Newsline) - Massachusetts Attorney General Martha Coakley announced a settlement on Monday with a health care services company and its affiliates to resolve allegations of failure to pay more than $800,000 in vacation wages to employees.

The Kennett, Pa.-based Genesis Healthcare allegedly did not pay vacation wages to employees who were separated or terminated from employment between October 2008 and November 2011. Coakley's Fair Labor Division began looking into the case after a former employee lodged a complaint. The company allegedly failed to pay 1,646 former employees vacation wages that they had earned upon termination or separation from employment.

"Employers that choose to offer vacation time must follow the law and properly compensate employees that have been terminated or separated," Coakley said.

Under the terms of the settlement, Genesis will pay 1,646 former employees a total of $826,072.04 and will pay the state $200,000. A total of $100,000 of the payment to the state will be used to create a trust to fund enforcement and education initiatives on hour and wage laws.

Genesis fully cooperated with Coakley's office on the case and in the audit of the vacation pay records.

Massachusetts law requires that employers providing paid vacation to their employees treat vacation pay like any other wages. Wages include all vacation time that has been earned. When an employee is separated or terminated from employment, employees must be compensated for vacation time earned as part of a written or oral agreement.

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