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Massachusetts Voters Reject Proposal to End Tipped Minimum Wage

November 7, 2024

On November 5, 2024, Massachusetts voters decisively rejected Question 5, a ballot initiative that sought to increase the minimum wage for tipped employees, aligning it with the standard minimum wage for all workers in the state. This measure proposed to gradually raise the base wage for tipped workers until it matched the state’s minimum wage, without taking into account tips. By rejecting this proposal, Massachusetts voters have chosen to retain the current two-tiered wage structure, which maintains a lower base wage for tipped employees, provided their total earnings meet or exceed the minimum wage through tips.

 

Background on Question 5 and Its Potential Impact

 

Question 5 was designed to phase out Massachusetts’ separate tipped minimum wage over several years. Currently, Massachusetts General Laws Chapter 151, Section 7 allows employers to pay a lower “service rate” to employees who regularly receive tips, which stands at $6.75 per hour. Under this law, employers are obligated to ensure that tipped employees’ total compensation, combining the service rate and tips, meets the state’s minimum wage, which is $15.00 per hour under Chapter 151, Section 1. If tips fall short, the employer must make up the difference.

 

The proposed law under Question 5 would have gradually raised the hourly wage for tipped workers until it was equal to the general minimum wage, eliminating the current requirement that tips make up the difference. By doing so, it aimed to provide tipped employees with a stable, predictable income without relying on tips to reach the minimum wage.

 

Legal Implications of the Rejection for Employers

 

With Question 5 rejected, Massachusetts employers will continue to follow the current requirements for tipped employees as outlined in Chapter 151, Section 7 and Chapter 149, Section 152A. Key legal implications include:

 

  1. Employers must continue to ensure that tipped employees’ combined wages, including tips, meet or exceed the state minimum wage. If employees’ tips do not reach this threshold, employers are responsible for covering the difference under Chapter 151, Section 7.
  2. Under Chapter 149, Section 152A, tips are strictly the property of employees, and employers must comply with state laws on tip pooling and distribution.
  3. Although Question 5 was rejected, discussions around tipped wages and fair compensation may lead to future legislative initiatives. Employers should remain aware of potential changes to ensure ongoing compliance with evolving wage laws.
  4. For businesses operating in multiple states, Massachusetts’ approach to tipped wages differs from states that mandate a single minimum wage for all employees, such as California. Employers must ensure they meet Massachusetts’ specific tipped wage regulations alongside other state laws.

 

Compliance Recommendations for Massachusetts Employers

 

With the tipped minimum wage system remaining in place, employers should continue to prioritize compliance through practical measures:

 

• Regular Wage and Tip Audits: Conducting audits of tipped employees’ earnings can help verify compliance with Chapter 151, Section 7 and prevent potential wage claims.

• Clear Tip Policies: Transparent policies regarding tip handling, tip pooling, and service charges are essential under Chapter 149, Section 152A to minimize disputes and ensure compliance.

• Management Training: Employers should provide regular training for managers overseeing tipped employees to ensure they understand wage and hour regulations and maintain lawful tip and wage practices.

 

Looking Ahead

 

Massachusetts voters’ choice to reject Question 5 retains the current wage structure for tipped employees, but ongoing discussions around fair compensation may drive future proposals. Employers should monitor legal developments closely and work with legal counsel to ensure compliance with Massachusetts wage laws as the regulatory landscape continues to evolve.

 

If your business has any questions on this topic and would like further guidance on Massachusetts wage compliance, or any other matters please do not hesitate to contact the attorneys at The Royal Law Firm at 413-586-2288.

Medical Marijuana Use Protected from Adverse Action

April 2, 2025
A recent court decision in Pennsylvania offers clarification that employers cannot take adverse action for marijuana use against individuals who possess medical marijuana cards, at least under Pennsylvania’s Medical Marijuana Act. In this decision, an individual received a conditional job offer for a non-safety sensitive position, contingent on a drug test. The individual disclosed his state-certified use of medical marijuana to treat anxiety, depression and ADHD, assuring the employer that it wouldn’t affect job performance or safety. After a positive test for marijuana, the employer rescinded the offer, citing safety concerns. The individual sued the employer under the Pennsylvania Medical Marijuana Act (“MMA”) and disability discrimination under the Pennsylvania Human Relations Act (“PHRA”). The Court allowed the individual’s claim under the MMA to proceed, potentially creating substantial precedent for tolerance of individual medical marijuana use in non-safety sensitive positions. The Court specifically noted that MMA protects individuals not just from discrimination based on card holder status, but also for adverse actions based solely on lawful medical marijuana use. The Court otherwise dismissed the individual’s claims under the PHRA because the PHRA does not require employers to accommodate medical marijuana use, even if it is prescribed for a legitimate medical condition. While a Pennsylvania decision, this decision potentially has rippling implications that will affect Massachusetts employers and employers in states where medical marijuana use is allowed under state law, which is allowed in some manner in 44 states. Employer Takeaways 1. Understand State-Specific Protections : Laws regarding medical marijuana use differ widely across states. In some areas, cardholder status is protected, while in others, it is not. Employers operating in multiple states must ensure their hiring and accommodation practices comply with the relevant laws in each state. 2. Base Safety Concerns on Job-Specific Evidence : General or speculative safety concerns are insufficient, particularly in states with strict employee protections. Safety risks cited should be specific, evidence-based, and directly related to the essential functions of the job. 3. Review Drug Testing and Accommodation Policies: Update your policies to reflect current state laws and clarify how your organization manages disclosures of medical marijuana use, especially during the hiring process . If you have any queries regarding drug testing or other workplace accommodations following this ruling, it is prudent to contact legal counsel. If your business has any questions on this topic or any other matters, please do not hesitate to contact the attorneys at The Royal Law Firm at 413-586-2288.

The Royal Law Firm Awarded Finalist of 2025 Best of The Valley Readers’ Poll

March 28, 2025
The Royal Law Firm was a Finalist for Best Law Firm in The Best of The Valley Readers' Poll for 2025, as published by the Valley Advocate! Thank you to everyone who voted for us, and to those of you who trust us to help you in times of need. Click here to check out all of the category winners and finalists.
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