Employer of Record for Massachusetts

In Massachusetts, workers’ rights are protected by numerous employment and labor laws, at both the state and federal level.  As a result, employees enjoy protection from discrimination based on age, religion, sexual orientation, gender, and race. Here are the key things you need to know about hiring in Massachusetts.

Do I need an EIN or Payroll Tax Number to Employ in Massachusetts

Employers in Massachusetts are required to have both a Federal Employer Identification Number (EIN) and a Massachusetts payroll tax number to hire employees and manage payroll. This enables them to comply with federal and state payroll tax obligations.

Working Hours in Massachusetts

Massachusetts doesn’t define full-time work hours by law. Instead, employers generally follow federal guidelines, where 30+ hours a week is considered full-time.

What Is Considered Full-Time Employment in Massachusetts

There is no legal definition of "full-time" employment in Massachusetts. However, full-time employees work 35-40 hours per week. Employers are required to provide a 30-minute break to employees who work more than six consecutive hours.

Probation Period in Massachusetts

In Massachusetts, probation periods aren’t required by law, it’s up to each employer to decide if they want one. Even if a probation period is in place, jobs are still considered “at-will,” meaning both you and your employees can end the relationship at any time.

Minimum Wage in Massachusetts 

As of 2025, the minimum wage in Massachusetts is:

• $15.00 per hour, well above the federal minimum of $7.25 per hour.
• Employees who receive tips must be paid a minimum of $6.75 per hour, provided that their tips bring their total earnings to at least $15 per hour. If they don’t meet the $15.00, employers are required to contribute the shortfall

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Read our Massachusets average salary guide for more.

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Massachusetts Anti-Discrimination Laws

Massachusetts law prohibits employers from discriminating against employees or applicants based on specific protected characteristics. These protections cover hiring, firing, promotions, and other employment terms. Protected categories include:

• Race and Color
• Religious Beliefs
• National Origin or Ancestry
• Sex, Gender Identity, and Sexual Orientation
• Age (for individuals 40 and older)
• Disability (physical or mental impairment that substantially limits major life activities)
• Marital Status
• Military Status (including veteran status)
• Genetic Information

Employers must provide reasonable accommodations for employees’ religious practices and disabilities unless doing so would impose an undue hardship on business operations.

Overtime in Massachusetts

Massachusetts requires eligible employees to be paid 1.5 times their regular rate of pay for all hours worked over 40 in a single workweek. Unlike California, Massachusetts has no daily overtime requirement, so working more than 8 hours in a day doesn’t trigger overtime unless weekly hours exceed 40.

Under the federal Fair Labor Standards Act (FLSA) and Massachusetts law, employees are generally exempt from overtime if they meet specific criteria, including:

• Earning more than the applicable exemption threshold: Because the 2024–2025 federal rule raising the salary level was blocked in court, the current threshold remains $684 per week ($35,568 annually).
• Performing duties that are executive, administrative, or professional: This includes managing other staff, exercising independent judgment on significant matters, or applying advanced knowledge in a specialized field.
• Working in certain certified or licensed professions: Such as lawyers, accountants, architects, engineers, and some highly skilled computer professionals.
• Falling into specific state exemptions: Massachusetts statute lists additional carve-outs, such as certain agricultural work, seasonal or recreational operations, and others.

If both state and federal overtime laws apply, employers must follow the standard that provides the greater benefit to the employee. Massachusetts also enforces strong penalties for any violations.

When it comes to payroll in Massachusetts global and local employers must follow state-specific wage laws and tax requirements. Unlike some states, Massachusetts does not mandate a specific payroll frequency for all businesses, but certain industries or collective bargaining agreements may require more frequent pay.

The key is consistency and ensuring that employees are paid on time and in compliance with state regulations.

Payroll Cycle in Massachusetts

In Massachusetts, employers can generally choose their payroll cycle, provided it meets state minimum frequency requirements for certain employees. The most common payroll cycles are:

• Weekly: Employees receive paychecks every week. This is common in industries such as construction, hospitality, and retail.
• Bi-Weekly: Paychecks are issued every two weeks (26 pay periods per year). This is the most common cycle for many Massachusetts employers.
• Semi-Monthly: Employees are paid twice a month, typically on fixed dates like the 1st and 15th.
• Monthly: Employees are paid once a month. This is less common in Massachusetts, and employers must ensure this schedule is allowed for their employee classification.

Types of Payroll Taxes in Massachusetts

Payroll taxes in Massachusetts include a combination of federal, state, and sometimes local obligations. Employers must stay up to date to ensure compliance. Key payroll taxes include:

• Federal Income Tax: Employers must withhold federal income tax from employees’ wages based on their IRS Form W-4.
• Massachusetts State Income Tax: Employers must withhold state income tax at a flat rate of 5%, based on the employee’s earnings and completed Form M-4.
• Paid Family and Medical Leave (PFML) Contributions: Massachusetts requires payroll contributions to fund the state PFML program. The total contribution rate is 0.88% of eligible wages, shared between employer and employee depending on company size.
• Social Security Tax (FICA): Both employers and employees contribute 6.2% of wages, up to the annual wage base limit set by the IRS.
• Medicare Tax (FICA): Both employers and employees contribute 1.45% of all wages, with an additional 0.9% for employees earning over $200,000 annually (employer does not match the additional tax).
• Unemployment Insurance (UI): Employers contribute to the Massachusetts UI Trust Fund at rates ranging from 0.56% to 18.55%, on the first $15,000 in wages per employee, depending on their experience rating.
• Workers’ Compensation Insurance: Required for most employers; rates vary based on the industry and job risk classification.
• Local Taxes: While Massachusetts does not impose local income taxes, certain municipalities (including Boston, Cambridge and Somerville, and Springfield) have other payroll-related ordinances or reporting requirements.

How to Comply with Massachusetts Payroll Taxes

Staying compliant with Massachusetts payroll laws means understanding state-specific requirements and keeping pace with changes. Here’s a simple checklist to help you stay on track:

1. Withhold Massachusetts State Income Tax: Use the employee’s Form M-4 to determine the correct amount to withhold at the current 5% rate.
2. Calculate and Collect PFML Contributions: Apply the PFML contribution rate to eligible wages and remit to the Massachusetts Department of Family and Medical Leave.
3. Pay Unemployment Insurance (UI): Contribute the correct rate based on your experience rating to the Massachusetts Department of Unemployment Assistance.
4. Maintain Workers’ Compensation Coverage: Secure a policy that meets Massachusetts’ requirements for your industry.
5. Report and Remit Taxes: File and pay federal taxes (Form 941) and state taxes on schedule. Massachusetts employers typically submit quarterly wage reports to the Department of Revenue (DOR) and the Department of Unemployment Assistance (DUA).
6. Stay Updated: Massachusetts updates PFML rates, UI rates, and wage bases annually. Check regularly with the DOR, DUA, and IRS for changes.
7. Leverage Payroll Software: Platforms like Playroll can automate calculations, withholdings, and ensure compliance, helping you avoid costly penalties.

Employment taxes and statutory fees affect both your payroll and your employees’ paychecks in Massachusetts . Understanding the tax obligations for both employers and employees is crucial when operating in Massachusetts' business landscape. This section explains how taxes and statutory fees affect payroll and individual earnings in Massachusetts. Note that employees may be liable for additional local taxes in certain cities and jurisdictions.

Employer Tax Contributions

You and your employees are responsible for specific employment taxes that contribute to federal and state programs, supporting benefits such as unemployment insurance, disability, and healthcare. Here's a quick summary of employer-specific payroll contributions:

Employee Payroll Tax Contributions

Your company will be subject to several payroll taxes, contributing to state programs and federal benefits. Here's a snapshot of what employee payroll tax contributions you need to be aware of:

Tax Due Dates in Massachusetts 

In Massachusetts, the deadline for filing individual state income tax returns aligns with the federal deadline, typically on April 15. If April 15 falls on a weekend or federal holiday, the deadline is extended to the next business day.

Pension in Massachusetts

Massachusetts offers both public and private pension options.

Public-sector employees are usually covered by the Massachusetts State Employees’ Retirement System (MSERS) or other public plans. These are defined benefit pensions, paying a guaranteed monthly amount based on service years, salary, and age. Most public workers do not contribute to Social Security, but instead pay 9% - 11% of their salary into the system, depending on hire date and plan tier.

In the private sector, traditional pensions are less common, with many employers offering defined contribution plans like 401(k)s. Massachusetts also provides the CORE Plan, a state retirement savings program for small nonprofits, allowing payroll-deducted contributions without requiring the employer to manage the plan.

Employers in Massachusetts must comply with specific benefit requirements, particularly around health insurance, sick leave, and workers’ compensation. While not all benefits are mandatory, certain benefits are required by state law.

As part of our global employment services, Playroll can create a globally compliant and competitive compensation package that can help you attract and retain top talent in the US.

Employee Benefits For Massachusetts 

Competitive benefits are essential for attracting and retaining top talent in Massachusetts. Offering the right package helps employees feel valued and motivated. Our benefits experts understand the local labor market's trends, requirements, and expectations, ensuring your employees feel valued and supported. Common benefits in our Massachusetts packages include:

• Pension or 401(K)
• Vision Insurance
• Life Insurance
• Medical Insurance
• Dental Insurance
• Health Savings Plan (HSA)
• Flexible Spending Account (FSA)

Are Employers Required To Provide Health Insurance in Massachusetts

Employers are not required by Massachusetts law to provide health insurance to employees, but they may face penalties under federal laws, such as the Affordable Care Act, if they do not offer coverage and have 50 or more full-time employees. For companies that offer health insurance, Massachusetts mandates that coverage meet minimum creditable coverage standards to avoid state penalties for employees.

Do Part-Time Employees Get Benefits in Massachusetts

Yes, part-time employees are entitled to certain benefits, including sick leave and workers’ compensation:

• Sick Leave: Under the Massachusetts Paid Sick Leave Law, all employees, including part-time workers, accrue sick leave.
• Workers’ Compensation: Massachusetts law requires workers’ compensation coverage for all employees, regardless of employment status or hours worked.

Are Employers Required To Offer 401k in Massachusetts

No, Massachusetts does not mandate that employers offer a 401(k) retirement plan. Employers may voluntarily offer additional retirement plans, such as 401(k)s or other options, to remain competitive in the job market.

• Good to know: Massachusetts has implemented the CORE Plan, specifically designed for small nonprofit organizations with 20 or fewer employees. The CORE Plan is a state-managed multiple employer 401(k) plan that allows eligible nonprofits to provide retirement benefits without the administrative burden of a private 401(k) plan.

Is Vacation Leave Mandatory in Massachusetts?

Massachusetts law does not require employers to offer either paid or unpaid vacation leave. However, if an employer chooses to provide vacation as a benefit, it must treat accrued vacation as earned wages. This means that any accrued, unused vacation time must be paid out upon termination of employment. Employers must also adhere to their own written vacation policies and cannot arbitrarily deny employees the right to use accrued leave.

Mandatory Leave Policies in Massachusetts 

Below are the mandatory leave entitlements for full-time employees in Massachusetts.

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Paid Time Off In Massachusetts 

Massachusetts does not mandate general Paid Time Off (PTO) policies for vacation or personal days, leaving it to the discretion of employers. If an employer offers PTO, any accrued but unused vacation time must be paid out upon termination, as the state considers accrued vacation time as earned wages. Employers must adhere to their own written policies regarding PTO.

Maternity Leave In Massachusetts 

Massachusetts provides maternity leave under the Paid Family and Medical Leave (PFML) program. Eligible employees can receive up to 12 weeks of paid leave to bond with a new child, including through birth, adoption, or foster placement. PFML benefits are funded through employer and employee contributions, and the amount paid is a percentage of the employee's average weekly wage, subject to a cap.

Paternity Leave In Massachusetts 

Paternity leave is also covered under the PFML program, allowing eligible employees to take up to 12 weeks of paid leave for bonding with a new child. The leave applies equally to both parents and is funded similarly to maternity leave. Eligible employees receive partial wage replacement based on a percentage of their average weekly wage.

Sick Leave In Massachusetts 

Under the Earned Sick Time Law, all Massachusetts employees are entitled to sick leave. Employees accrue 1 hour of sick leave for every 30 hours worked, up to a maximum of 40 hours per year. Employers with 11 or more employees must provide paid sick leave, while smaller employers may offer it as unpaid. Sick leave can be used for the employee's or a family member's illness, medical appointments, or domestic violence recovery.

Military Leave in Massachusetts 

Massachusetts follows the federal Uniformed Services Employment and Reemployment Rights Act (USERRA), which requires employers to provide job-protected leave for employees who serve in the military. Under this law, employees returning from service are entitled to reinstatement in their previous position or a comparable one. Massachusetts law reinforces these protections, ensuring no penalties or loss of benefits for employees on military duty.

Jury Duty in Massachusetts 

Massachusetts law requires employers to provide leave for jury duty service, prohibiting penalties or retaliation against employees fulfilling this civic duty. The first three days of jury duty are paid by the employer; any additional days may be unpaid. Employees cannot be terminated or penalized for serving on a jury.

Parental Leave In Massachusetts 

Under PFML, Massachusetts provides 12 weeks of paid parental leave for bonding with a new child, covering both mothers and fathers. Additionally, the Massachusetts Parental Leave Act (MPLA) requires employers with six or more employees to offer 8 weeks of unpaid leave for the birth or adoption of a child. If both parents work for the same employer, they may share the 8-week leave under MPLA.

Small Necessities Leave in Massachusetts

Massachusetts offers Small Necessities Leave, granting employees up to 24 hours of unpaid leave per year for family-related obligations, including attending school activities or medical appointments for family members. This leave is available to employees working for companies with 50 or more employees and is in addition to PFML and sick leave.

When it comes to terminating employment in Massachusetts, understanding the legal obligations regarding severance pay and contributions is essential. Below is a detailed overview of the key considerations for both employers and employees.

Termination Process in Massachusetts 

Massachusetts follows an "at-will" employment policy, which means employers can terminate employees at any time and for any reason, as long as it is not an illegal reason (such as discrimination or retaliation). This policy allows both employers and employees to end the employment relationship without advance notice or justification, although certain exceptions and protections apply under federal and state law.

Notice Period in Massachusetts 

Massachusetts does not have a legal requirement for employers to provide a notice period before termination. Employers may terminate an employee without giving advance notice, though some employers may choose to include notice requirements in employment contracts or company policies.

Severance in Massachusetts 

There is no requirement for employers to provide severance pay in Massachusetts. Severance is only required if it is specified in an employment contract or company policy. Many employers choose to offer severance packages as a gesture of goodwill or to secure a release of claims from the departing employee.