BOSTON POLICE PATROLMEN'S ASSOCIATION, INC. v. City of Boston

• Decision Date: 06 November 2001
• Citation: 761 NE 2d 479,435 Mass. 718
• Parties: BOSTON POLICE PATROLMEN'S ASSOCIATION, INC., & others v. CITY OF BOSTON & another.
• Court: United States State Supreme Judicial Court of Massachusetts Supreme Court

435 Mass. 718

761 NE 2d 479

BOSTON POLICE PATROLMEN'S ASSOCIATION, INC., & others¹ v. CITY OF BOSTON & another.²

Supreme Judicial Court of Massachusetts, Suffolk.

November 6, 2001.

January 30, 2002.

Present: MARSHALL, C.J., GREANEY, IRELAND, SPINA, COWIN, SOSMAN, & CORDY, JJ.

John M. Becker for the plaintiffs.

John Foskett (Catherine S. Reidy with him) for the defendants.

Paul T. Hynes, for the interveners, was present but did not argue.

John Foskett, for the Massachusetts Municipal Association, amicus curiae, submitted a brief.

IRELAND, J.

More than 1,300 police patrol officers and detectives (plaintiffs) sued the city of Boston and its police department (city) under G. L. c. 149, § 148, the so-called "weekly wage law."³ The plaintiffs argue that employee contributions to a tax-exempt deferred compensation plan are "wages" under the statute, and therefore subject to the requirement that they be paid within seven days of the end of the pay period, but that these monies generally have not been deposited in the appropriate accounts within seven days. The plaintiffs moved in the Superior Court for judgment on the pleadings, and judgment entered for the defendants. We granted the plaintiffs' application for direct appellate review. Because we agree with the Superior Court judge that contributions to a deferred compensation plan are not "wages" under this statute, we affirm the judgment.

The relevant facts are few and uncontested. The city offers a deferred compensation plan as a benefit to its employees. Employees who choose to participate agree to reduce their pay, and designate the amount of that reduction to be invested in one or more of several tax-deferred funds. The city then transfers those amounts to plan coordinators for investment. Prior to January, 1996, the city's procedures were cumbersome, involving the mailing of information back and forth between the management information system department, the auditing department, the treasury department, and the plan coordinators. The total time for this process generally exceeded seven days, and sometimes took as long as five weeks. In early 1996, the city began using electronic transfers rather than regular mail, reducing the time from payroll deduction to receipt by plan coordinators to an average of from five to ten days.

Because it is undisputed that the city did not always manage to transfer the plaintiffs' contributions to their accounts within seven days, the question before us is whether deferred compensation contributions are "wages" under this statute.⁴ Statutory interpretation is a question of law for the court. See Annese Elec. Servs., Inc. v. Newton, 431 Mass. 763, 764 n.2 (2000). As always, we interpret the statutory language "`according to the intent of the Legislature ascertained from all its words construed by the ordinary and approved usage of the language, considered in connection with the cause of its enactment, the mischief or imperfection to be remedied and the main object to be accomplished, to the end that the purpose of its framers may be effectuated.' O'Brien v. Director of the Div. of Employment Sec., 393 Mass. 482, 487-488 (1984), quoting Industrial Fin. Corp. v. State Tax Comm'n, 367 Mass. 360, 364 (1975)." Champagne v. Champagne, 429 Mass. 324, 326 (1999).

The plaintiffs argue that the weekly wage law is remedial and should be construed broadly to effect its intended purpose. See Neff v. Commissioner of the Dep't of Indus. Accs., 421 Mass. 70, 73 (1995). The purpose of the weekly wage law is clear: to prevent the unreasonable detention of wages. See American Mut. Liab. Ins. Co. v. Commissioner of Labor & Indus., 340 Mass. 144, 147 (1959). The point of a deferred compensation program, however, is that payment will be deferred. The Legislature's remedy for the evil of unreasonable detention of wages is not applicable to deferred compensation contributions. The contributed funds are intended to be held, out of the employee's possession, for an extended period. In exchange, the employee receives the benefit of a tax deferment. Any employee who wishes to forgo the tax benefit and receive that money as it is earned may choose not to enroll in the program. The plaintiffs' arguments for a contrary statutory construction are unavailing.

The deferred compensation plan is authorized by G. L. c. 29, § 64B, inserted by St. 1988, c. 319, which provides that the Commonwealth and its subdivisions may offer such a program "in accordance with the U.S. Internal Revenue Code." The Internal Revenue Code requires that, in order to obtain the taxdeferral benefit, contributions "shall remain (until made available to the participant or other beneficiary) solely the property and rights of the employer ... subject only to the claims of the employer's general creditors." 26 U.S.C. § 457(b)(6)....