In a highly technical, twenty-page opinion, a three-judge panel of the Massachusetts Appeals Court declined to answer the question of whether volunteer members of boards of directors of nonprofits can be held personally liable to workers for unpaid wages under the Massachusetts Wage Act. With the issue unresolved, for the time being, volunteer board members will continue to face some uncertainty about their possible personal liability.
The case, Lynch v. Roxbury Comprehensive Community Health Center, Inc., No. 18-P-179 (Nov. 30, 2018) involved a nonprofit that was struggling financially. The chair of the nonprofit’s volunteer board of directors—who was also holding himself out as the organization’s “president” and “acting CEO”—decided to use the entity’s limited funds to pay vendors instead of paying wages. Employees brought a class action lawsuit under the Massachusetts Wage Act, seeking recovery from the nonprofit, as well as from the board chair individually. Under the Massachusetts Wage Act, the president and treasurer of a business entity, and any officers or agents managing the entity, can be held personally liable for the entity’s failure to pay wages. The board chair sought to have the case against him dismissed on grounds that he was immune under state and federal laws protecting volunteers. Continue Reading Massachusetts Appeals Court Declines to Rule on Non-Profit Board Member Immunity Under Wage Act