Are Bonuses Protected Under the Massachusetts Wage Act?

A bonus can be a powerful incentive. It can reward strong performance, encourage employees to stay with a company, or recognize exceptional contributions. But what happens when an employer decides not to pay a bonus in the way an employee expected or at all? Under the Massachusetts Wage Act, are all bonuses protected, or does the answer depend on the type of bonus? The answer depends on the nature of the bonus. 

Whether you are an employer designing compensation plans or an employee pursuing an unpaid bonus claim in Massachusetts, we can help you protect your rights and avoid costly disputes. Our legal team at Berluti McLaughlin & Kutchin LLP has over 15 years of experience protecting parties in employment matters, and we are ready to safeguard your interests.

You can reach our lawyers by calling 617-557-3030. 

What Are My Wage Rights in Massachusetts?

The Massachusetts Wage Act (Wage Act) requires employers to pay employees all wages earned within specific timeframes. Employees who leave their jobs, whether voluntarily or involuntarily, also have the right to timely payment.

The law helps ensure employees receive compensation without unnecessary delay, and punishes employers who retaliate against employees who assert their rights or participate in wage proceedings. Employees may bring private lawsuits for unpaid wages, and the Massachusetts Attorney General’s Fair Labor Division may also investigate and punish wage violations.

Although the Wage Act provides strong protections, not every form of compensation qualifies as protected wages. That distinction becomes especially important when discussing the Massachusetts Wage Act and bonuses.

Does the Massachusetts Wage Act Protect Bonuses?

If the payment of a bonus is contingent on certain circumstances, it may not be protected under the Wage Act. The law is nuanced about what it protects.

No Massachusetts Wage Act Protection for a Discretionary or Contingent Bonus

In the 2025 case Nunez v. Syncsort Inc. (Nunez), the Massachusetts Supreme Judicial Court (SJC) considered whether a retention bonus qualified as wages under the Wage Act. Wages have to be paid immediately after a layoff. While the employee was promised bonus payments for staying with his employer during a business transition and was not given his final bonus payment until eight days after being laid off, this alleged delay in payment was not a Wage Act violation under section 148. The SJC noted that the Wage Act typically does not protect contingent (or discretionary) payments, and the employee’s retention bonus was no different.

A bonus may fall outside the Wage Act’s protections if it: 

  • Is separate from an employee’s salary, and 
  • It is not compensation for completed work. 

The Nunez decision reinforces the need for employers to draft bonus plans carefully and to describe any conditions for payment clearly. At the same time, employees should review bonus agreements closely before assuming an unpaid bonus qualifies as recoverable wages under the commonwealth statute.

Protection for a Non-Discretionary Payment or Bonus in Massachusetts

A non-discretionary bonus arrangement typically establishes objective requirements for earning the payment that are tied to the employee’s output. For example, an employer may promise a bonus after an employee: 

  • Reaches specified production goals, or 
  • Meets measurable performance benchmarks.

Even then, the analysis may not end there. 

A court may also examine whether additional contingencies remain before payment becomes due. As Nunez illustrates, compensation that remains contingent on future events or actions may not qualify as wages under the Massachusetts Wage Act.

Because bonus disputes often depend on the specific language of compensation agreements, employers should periodically review bonus plans with experienced counsel. Employees should likewise seek legal advice before concluding they have a valid unpaid bonus claim in Massachusetts.

How Do Commissions Differ in Massachusetts?

The Wage Act and Massachusetts courts have long recognized that commissions are contingent payments that often qualify as protected wages. In Okerman v. VA Software Corp., the Massachusetts Appellate Court examined when a commission would become sufficiently earned to receive Wage Act protection. The Wage Act specifically covers commissions, and commissions frequently become protected wages once: 

  • The agreed conditions for earning them have been satisfied, and 
  • The amount can be determined. 

Understanding this difference matters for both employers and employees. 

A compensation plan labeled as a “bonus” may receive different legal treatment than one structured as a commission. This depends on how the plan actually operates. Whether compensation qualifies as a commission, an unprotected form of contingent compensation, or a non-discretionary bonus in Massachusetts depends on the specific agreement and the applicable legal standards.

What Are the Penalties for Violating Massachusetts Wage Laws?

Massachusetts takes wage violations seriously. Employees who successfully prove a Wage Act violation may recover:

  • Treble damages for lost wages, 
  • Reasonable attorney fees and litigation costs, and
  • Injunctive relief. 

For employers, these remedies make careful compensation planning essential. For employees, they provide meaningful tools to recover wages protected by the law.

Practical Takeaways for Employers and Employees

The SJC’s decision in Nunez offers valuable guidance for everyone involved in compensation disputes.

Employers should consider:

  • Clearly defining whether bonus programs are discretionary or non-discretionary,
  • Stating all eligibility requirements and contingencies in writing,
  • Reviewing compensation plans regularly to help ensure they accurately reflect business objectives, and
  • Seeking legal advice before withholding compensation that may qualify as wages under the Massachusetts Wage Act.

Employees should consider:

  • Carefully reviewing bonus agreements before accepting employment or signing additional agreements,
  • Keeping copies of compensation plans and other communications, and
  • Consulting experienced counsel if they believe they were denied compensation they earned.

Because the consequences of a Wage Act violation can include mandatory treble damages, properly classifying compensation benefits for both employers and employees is critical.

We Can Help You Get It Right

At Berluti McLaughlin & Kutchin LLP, our experienced team represents both employers and employees in complex wage and employment disputes throughout Massachusetts. Whether you need guidance on drafting bonus plans, defending Wage Act claims, or pursuing unpaid compensation, our attorneys can help evaluate your rights and develop a practical strategy. 

Please call us or contact us online today.

Frequently Asked Questions

Does the Massachusetts Wage Act Cover Non-Discretionary Performance Bonuses?

It likely does, but coverage depends on the unique details of your employment agreement.

After the 2025 SJC ruling in Nunez v. Syncsort, Are Retention Bonuses Still Enforceable in Massachusetts?

Yes. But you may have to seek enforcement through a breach-of-contract claim rather than a Wage Act claim.

What Penalties Can an Employer Face for Failing to Pay a Promised Bonus in Massachusetts?

If compensation qualifies as wages under the Massachusetts Wage Act, an employer may face treble damages, attorney’s fees, and injunctive relief. If a bonus isn’t a wage, an employer may have to pay damages or give other relief for breach of contract.

What Is the Difference Between a Discretionary and a Non-Discretionary Bonus Under Massachusetts Law?

A discretionary bonus generally allows the employer to decide whether and how much to award, and may not be tied to an employee’s output. A non-discretionary bonus in Massachusetts is usually tied to objective performance and is easy to calculate using agreed-upon terms.

Legal References Used to Inform This Page

To ensure the accuracy and clarity of this page, we referenced official legal and other resources during the content development process:

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