Employer Alert: Massachusetts Wage Act May Apply to Out-of-State Remote Workers

May 29, 2025

A recent decision from the Business Litigation Session (“BLS”) of the Suffolk Superior Court highlights the difficulty employers face in navigating the laws applicable to remote workers.

Dubois v. Staples, Inc., et al. (April 2025)

In Dubois v. Staples, Inc., et al. (Civil No. 23-1746-BLS1) (Suffolk Superior Court) (April 1, 2025), the court ruled that an employee who lives and works in Rhode Island can nevertheless bring claims for unpaid wages and commissions under the Massachusetts Wage Act, a statute that carries severe penalties for employers, including treble damages, attorneys’ fees and costs. 

In Dubois, the employer argued that Rhode Island law should apply to the employee’s claims for unpaid commissions, given that the employee lived in Rhode Island, worked remotely in Rhode Island, had a Rhode Island phone number, received her final paycheck at her Rhode Island address, paid Rhode Island taxes, and claimed Rhode Island unemployment benefits after termination. The court rejected these arguments, however, finding that Massachusetts had the “most significant relationship” to the employment relationship, given that the employee’s sales territory covered only Massachusetts at the relevant time, the employee traveled to Massachusetts every week or two, the individuals who failed to pay the commissions were situated in Massachusetts, and the employer is based in Massachusetts.

Out-of-State Employees and the Most Significant Relationship Test

The question of whether an employee who lives and works outside Massachusetts may reap the benefits of Massachusetts law requires a fact-specific analysis that has grown increasingly complex with the rise of remote work. Since the seminal case of Dow v. Casale, 83 Mass. App. Ct. 751 (2013), both state and federal courts in Massachusetts continue to revisit “the most significant relationship” test to decide, with varying results, whether the Massachusetts Wage Act applies to an out-of-state employee’s claims for unpaid wages. For example, in Musachia v. Abiomed, Inc., No. 2377CV00310-B (Mass. Sup. Ct., Essex Dec. 12, 2023), the court found that the Massachusetts Wage Act did not apply to an out-of-state employee even though the employer’s headquarters were in Massachusetts. Similarly, in Viscito v. National Planning Corp., 34 F.4th 78 (1st Cir. 2022), the court found that the Act did not apply to a Florida resident whose company and office were in Massachusetts but who was an independent contractor for a California-based company. Yet, in a third case, Wilson v. Recorded Future, Inc., et al., 669 F.Supp.3d 53 (D. Mass. 2023), the court found that the Act applied even when, as in Dubois, the aggrieved employee worked and resided outside Massachusetts.

To assess which state has the most significant relationship to the employment relationship, courts consider the following factors:

·       The location of the employer’s headquarters;  

·       The place(s) where the employee performs the work;

·       The frequency of interactions between the employee and employer in Massachusetts, including if the employee is receiving directions or instructions from colleagues in Massachusetts;

·       Whether the employee’s job duties require travel to Massachusetts, including for trainings and in-person meetings;

·       Whether the decision(s) regarding the employee’s termination, compensation, or commission payments are made in Massachusetts; and

·       If applicable, whether the employment contract has a choice of law provision identifying Massachusetts.   

Conclusion

Given that fully remote workers now make up more than 10% of the national workforce, employers must be careful to understand the various state laws that might apply to this group. While wage and hour issues have received frequent attention from the courts, there are a number of Massachusetts employment laws that cannot be ignored simply because an employee works or lives outside of Massachusetts. For questions, we encourage employers to consult legal counsel.

For further information about the Massachusetts Wage Act, contact Allyson E. Kurker and Margaret H. Paget at Kurker Paget LLC.