Maryland Amends Wage Payment and Collection Law to Include Overtime Compensation
The Maryland General Assembly recently passed several important amendments to Maryland’s Wage Payment and Collection Law — which requires employers to promptly pay employees for their services or be subject to treble damages and attorney’s fees.
First, the General Assembly amended the definition of “wage” to include “overtime wages.” Consequently, if a court finds that an employer improperly withheld overtime wages, the employee may be entitled to treble damages in some circumstances. Effectively, this means the employee may be able to recover his overtime wages (i.e. time and one-half of the employee’s regular hourly rate) plus the treble damage penalty. For example, an employee earning $15 per hour could recover as much as $540.00 for 8 hours of unpaid overtime.
Prior to the amendment, there was existing court precedent that held an employee could sue for overtime wages under only the federal Fair Labor Standards Act and the Maryland Wage and Hour Law. This amendment should cause employers to take a second look at their overtime policies to ensure that they are properly and timely paying overtime compensation to their non-exempt employees.
The General Assembly also created a new administrative procedure for individuals who have wage claims for up to $3,000. Instead of going to court, employees with such claims may now file a claim with Maryland’s Department of Labor, Licensing and Regulation which will then give the employer written notice of the claim and 15 days to respond. The Commissioner of Labor and Industry will then review the claim, conduct an investigation if necessary, and will issue an order requiring the employer to pay the wages if a determination is made that the law was violated.