Imagine the following scenario.
You work for a small company, ABC Widgits Corp., where the owner is involved in the day-to-day operations of the Company. She hired you, she established your hourly rate, and she set your schedule. And when she fired you, she refused to pay you your last paycheck, claiming that you don’t deserve it because of your poor performance.
Obviously, you can sue the company for your last paycheck. The claim would be filed under the Maryland Wage Payment and Collection Law, which permits you under certain circumstances to recover up to treble damages plus attorney’s fees for unpaid wages.
The question is – can you sue the company’s owner as well? In other words, is the owner herself also considered to be an “employer” under the Maryland Wage Payment and Collection Act, just like the company, ABC Widgits Corp.?
The Maryland Court of Special Appeals, in a case of first impression, recently said, Yes. In the case of Campusano v. Lusitano Construction LLC, the Court ruled that when answering the question, “Who is the employer?” under the Maryland Wage Payment and Collection Law, the answer is determined by the “economic realities” of the situation. Therefore, an owner or supervisor of an employee may be considered an “employer” (and, therefore, can be sued individually) when that individual “controls” the employment relationship. Although the test for “control” is not supposed to be applied “mechanistically,” the Court identified the following 4 factors, which may be considered for identifying an “employer.” Those factors are: whether the alleged employer (1) had the power to hire and fire the employees; (2) supervised and controlled employee work schedules or conditions of employment, (3) determined the rate and method of payment, and (4) maintained employment records. If these factors are met, an owner or supervisor may be held personally responsible for unpaid wages, including a claim for up to treble damages and attorneys’ fees.
Schedule a Consultation
If you have questions about issues that arise in the Maryland workplace, call the employment law attorneysat Luchansky Millman for guidance. Bruce M. Luchansky and Judd Millman have decades of experience in handling employment law matters, and they regularly assist employees and employers sort through legal issues that arise in the workplace. Call them at 410.522.1020 to schedule a consultation.