United States – Massachusetts

Employment

In MA there are different types of employment – employment at will, contracted employment and state workers. In all of these cases, the employee and employer come to common terms before entering into an employment agreement.

Payroll

Salaries are paid in biweekly pay cycles.

HR & Labor

Working Hours: Full time employment is 40 hours per week and employees must be paid 1.5 times more of their hourly wage for overtime. Non-discrimination and equal pay – employers cannot discriminate against sex, race, gender identity, sexual orientation, genetic information, age. Meal Breaks – employees working more than 6 hours are entitled to 30-minute meal break. If employee voluntarily agrees not to take the break, employer must compensate.
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Minimum Working Age: 14-15 year olds cannot be employed during school hours, between 7p.m. and 7 a.m, more than 3 hours during school year and more than 8 hours during vacation. Overall they can work total of 18 hours per week during school year and no more than 40 hours a week during vacation time. 16-17 year olds cannot be employed more than 9 hours per day, 48 hours per week and 6 days a week. Any employee under age of 18 must have an employment permit which has to be issued for and kept at the employment location.

Immigration

In order to work legally in the United States of America, an employee must be a citizen of the US, have a permanent resident status (Green Card), H-1B visa or L-1 visa.

Benefits

Employers offer different types of insurances for their employees – health, dental, vision and life. Employees are also eligible for long term disability, dependent care assistance program, transportation benefit, extended illness leave bank, employee assistance program. Other benefits: lunches, tuition remission

Minimum Wage

Minimum wage is $10.00 an hour.

Pension Fund

The employer contributes 6.2% of earnings for each employee.

Employees pay 6.2% of their earnings. Additional 1.45% is taken out of all earnings for Medicare’s Hospital Insurance Trust Fund. Contribution limit is $18,000.

Severance Payments

Severance payments are not required in MA. A company can offer the employee some kind of a severance package, however in MA it counts as income and terminated employee will not be able to file for unemployment if they accept the severance package.

Advance Notice

Giving a “two-weeks” advance notice is considered the “right” thing to do, however employees are free to leave their job whenever.

Termination Procedure

If an employee is discharged, he/she must be paid fully on the last day of employment including for the unused vacation days. If an employee quits, he/she will be paid on the scheduled pay day.

Sick Days

Employee is entitled to 40 hours sick leave per year.

If the employer has 11 or more employees – sick days must be paid for. If 10 or less employees – sick days are unpaid.

If out for 3 consecutive days, employer can request proof of medical documentations.

Public Holidays

State and public employees have total of 13 paid off holidays. However, no law in MA requires private companies to give paid time off for a holiday. Paid holidays vary depending on the company’s internal policy.

Expat Benefits

There are no official expat benefits. However different companies can offer special benefits for the expats working for them. Benefits differ from one company to another.

Additional Employee Withholdings

Federal:
1. Medicare - 1.45%
2. Social Security - 6.2%
3. Unemployment Tax - 6.0% and maximum taxable earnings are $7,000
State:
1. Unemployment Insurance - 1.87% with maximum taxable earnings of $15,000.
2. Employer Medical Assistance Contribution - 0.12% for third year of liability, 0.24% for fourth year and 0.34% for fifth year and on.
3. Workforce Training Fund - 0.056%

Federal:
1. Medicare - 1.45% (additional 0.9% contribution for employees earning less than $200,000)
2. Social Security - 6.2% with salary ceiling of $118,500
3. Unemployment Tax - 0%
State:
1. Unemployment Insurance - Voluntarily contribution
2. Employer Medical Assistance Contribution - 0%
3. Workforce Training Fund - 0%

Social Security

As of 2011, after the Tax Relief, Unemployment Insurance Re-authorization and Job Creation Act of 2010, the Social Security tax rate is 4.2 percent of an employee's wages.
In addition, there is a limit to the amount of wages that are subject to Social Security taxes. In 2016, the taxable wage base is be $118,500.

VAT / State Sales Tax

State sales tax is 6.25%.