Both federal law and Maryland state law allows employees to file lawsuits, administrative complaints, or liens for unpaid wages. This right includes claims for regular wages and benefits and, if applicable, overtime wages. State and federal law also establishes minimum wage and overtime standards, the violation of which will provide the basis for a lawsuit, even if the employee agrees to it.
Naturally, the minimum wage does not apply if the employer and the employee agree to a higher rate. In such a case, the “minimum wage” becomes whatever the employer and the employee agreed to, regardless of whether the employee is paid by the hour, by the month, or by commission. An unpaid employee can file a claim for all due back pay.
Although the federal minimum wage is $7.25 per hour, the Maryland state minimum wage is $10.10 per hour. Since the state minimum wage is higher, Maryland employers must pay $10.10 per hour unless a special exception applies. Tipped employees can be paid as little as $3.63 per hour as long as the remainder ($6.47 per hour) is made up in tips.
Certain employers may rely on the Fair Labor Standards Act (FLSA) to pay teenage employees a lower hourly rate during their first six months of employment. Keep in mind that certain localities require an even higher minimum wage than the state of Maryland does:
- Montgomery County’s minimum wage is $12.25 per hour if the employer has more than 50 employees and $12 per hour for other employers.
- Prince George’s County applies a minimum wage of $11.50 per hour.
Overtime pay is required for most Maryland employees who are paid by the hour. The standard overtime pay is 150 percent of the employee’s wages for every hour over 40 hours per week. Owners of bowling alleys and nursing home facilities only have to pay overtime for employees who work more than 48 hours per week, and employers of agricultural workers only have to pay overtime if their employees work more than 60 hours a week.
Although salaried workers generally do not enjoy a legal right to overtime pay, in some cases, Maryland will require overtime pay for a salaried worker. This occurs if they feel that the employer is simply using the “salaried” designation to avoid paying overtime to a worker who would otherwise be entitled to it, for example.
The following employees generally do not have the right to overtime pay:
- Executives, administrative personnel, and professionals;
- Employees engaged in outside sales and motor carrier activities;
- Restaurant employees, if the restaurant has an annual gross income of under $250,000
- Movie theater employees;
- Hotel, motel, and gas station employees;
- Recreational establishment employees (amusement parks, etc.)
- Country club employees;
- Certain employees of non-profit charities;
- Certain mechanics who service cars, farm equipment, trailers, or trucks
- Employees paid on commission;
- Food processing employees;
- Volunteers at non-profit organizations; and
- Certain other employees.
Remember, federal overtime laws still apply even when Maryland overtime laws don’t.
Bonuses and Fringe Benefits
You can also file a claim for unpaid bonuses and fringe benefits (health insurance, unused vacation time, etc.).
The following scenarios might justify taking enforcement action against an employer:
- Refusing to pay regular wages;
- Refusing to pay for overtime;
- Refusing to pay promised bonuses or fringe benefits;
- Illegally withholding deductions from the employee’s paycheck;
- Refusing to pay for attendance at mandatory training sessions;
- Refusing to provide paid maternity leave;
- Bouncing a paycheck; or
- Other scenarios.
Employees have three options for remedy:
- Filing an administrative complaint (if the amount owed is no more than $3,000);
- Filing a civil lawsuit against the employer; OR
- Seeking a lien against your employer’s property.
An aggrieved employee can select only one of the three remedies mentioned above.
Filing an Administrative Claim
One option is to file an administrative complaint with the Maryland Employment Standards Service. The process works like this:
- The employee sends the employer a certified letter, return receipt requested, that contains a formal demand letter with the employee’s signature. The letter should state the amount of money the employer owes and the basis for this amount (which hours were worked on which days, for example). The letter should also set a reasonable deadline – 10 days from receipt, for example.The employee should make at least two copies of the letter for his or her records. The employee should also keep the return receipt when it arrives, because that is what proves your employer received your demand letter.
- If the employer fails to respond, the employee can file a formal administrative complaint with the Maryland Employment Standards Service (ESS). To do this, the employee should send a copy of the demand letter to the ESS along with a completed claim form. ESS will then conduct an investigation and attempt to collect any money the employer has illegally withheld. ESS may even take the employer to court.
Filing a Civil Lawsuit
Instead of filing an administrative claim, an employee can file a civil lawsuit for money damages against the employer. If it is successful, damages may include unpaid wages plus liquidated damages and attorney’s fees. In certain cases of employer misconduct, the court can award damages of up to three times the amount that the employer owes the employee. Even if a civil lawsuit is filed, however, the odds are good that the claim will end up being settled out of court.
Seeking a Lien against Your Employer’s Property
A lien against an employer’s property can be obtained by proving to the court that the amount is due, and by proving which property the employer owns (real estate or a bank account, for example). The court will then issue an order establishing the lien. The employee must then publicly record the lien so that everyone will know that the employer’s property is encumbered. To receive the money, the employee may have to seek a court-ordered sale of the employer’s property.
Don’t Delay – Contact Smithey Law Group Today
If you believe you may have a back wages claim, or if you are an employer who fears that such a claim might be asserted by your employee, contact Smithey Law Group today for a confidential consultation by calling (410) 919-2990 or by contacting us online. We serve clients in Annapolis, Baltimore, Columbia, Dundalk, Frederick, Germantown, Glen Burnie, Rockville, Silver Spring, and Waldorf.