While it is generally understood that decisions of courts apply retroactively (as interpretations of the law) while newly enacted statutes do not (as pronouncements of new law) unless expressly provided by the statutory language, challenges to these principles often arise, especially when the decision or enactment modifies recoverable damages. In a victory for employers, Massachusetts’ highest court ruled last week that the 2008 legislation which created a “treble damages” remedy for violations of the Massachusetts Wage Act applies only to violations which occurred after the statute’s enactment date of July 12, 2008. Rosnov v. Molloy, 2011 Mass. LEXIS 735 (Mass. Aug. 31, 2011). This decision is in accord with a prior federal court decision.  DiFiore v. Am. Airlines, Inc., 688 F. Supp. 2d 15 (D. Mass. 2009).

Rosnov concerned an attorney who worked for a separate law office and, after leaving that office, was able to prove at trial that she was entitled to a commission for a referral based on an oral contract.  Following the jury’s verdict, plaintiff argued to the trial court that the treble damages provision should apply even though her claim was brought in 2007 and related to events occurring in an earlier time period. The trial court agreed, and awarded treble damages.  In analyzing the case under the traditional rule regarding retroactivity, the Supreme Judicial Court of Massachusetts observed that “the distinction between legislation that concerns ‘substantive rights,’ and legislation that concerns ‘procedures’ and ‘remedies,’ has proved to be difficult to draw.” Nevertheless, the court ruled that “Absent an express legislative directive to the contrary . . . the mandatory treble damages . . . should not be retroactively applied.” Finding no such express directive, the court held that the provision did not apply to claims accruing before the enactment date of July 12, 2008.   

While this ruling is favorable to employers, and hopefully will inform courts analyzing retroactivity of damages provisions  under other statutes, such as New York’s Wage Theft Prevention Act (and the decisions to date have indicated the statute does not apply retroactively), the harsh reality in Massachusetts is that the treble damages provision remains applicable for wage claims accruing after July 2008, creating significant potential liabilities.