Opinion ID: 2778157
Heading Depth: 2
Heading Rank: 2

Heading: The Minnesota Prompt Pay Statutes

Text: We now turn to the prompt pay statutes. Bahr claims entitlement to double damages, relying on three distinct provisions of the Minnesota statutes: §§ 181.03, 181.13, and 181.14.8 These provisions do not create substantive rights; instead they offer a recovery mechanism for past due wages and impose civil penalties on employers that fail to seasonably remit those wages.9 Caldas v. Affordable Granite & Stone, Inc., 820 N.W.2d 826, 837. The applicability of each provision will be addressed in turn.
Liability under this section attaches only if the employer acts with a fraudulent intent. § 181.03. Bahr contends that TCP executives were aware that the fixed charge coverage ratio would be a problem prior to the end of the calendar year, yet continued encouraging Bahr to hit her numbers so that she could earn the maximum bonus. This contention is not supported by the record and is insufficient to plead fraud. See Fed. R. Civ. P. 9(b). TCP is entitled to summary judgment with respect to this provision. See Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 252 (1986).
Section 181.13 applies only where an employee has been discharged by the company. Bahr claims that summary judgment was inappropriate because there is sufficient evidence in the record to suggest that she was constructively discharged. Though Bahr expressed her 8 Only §181.03 provides for double damages. An employer who is found liable under any of these provisions shall also be made to pay for reasonable costs and attorney fees. § 181.171. 9 An earned bonus constitutes a wage under the statutes. See Kvidera, 705 N.W.2d at 423–24. 19 No. 14-3356 “disappointment” and desire to work for a “more honest” company upon her resignation, the record indicates that she was offered other opportunities for advancement and continued to receive top marks in her performance reviews after the dispute began. Construing the facts in the light most favorable to Bahr, working conditions were not “so intolerable that [she was] essentially forced to leave the employment.” Willis v. Henderson, 262 F.3d 801, 810 (8th Cir. 2001). TCP is therefore also entitled to summary judgment foreclosing any recovery under this provision.
TCP does not dispute the applicability of § 181.14 other than contesting Bahr’s entitlement to the bonus itself. Section 181.14 requires the full payment of any earned and unremitted wages to be made at “the first regularly scheduled payday following the employee’s final day of employment.” Bahr’s bonus was earned at the close of the 2011 calendar year and was to be paid no later than 45 days later, pursuant to the C&I Bonus Plan. This payment was outstanding when Bahr resigned on October 8, 2012. The next regularly scheduled payday was October 15, 2012. Payment of Bahr’s “earned and unpaid” bonus was statutorily due on that date. See Kvidera, 705 N.W.2d at 423–24 (holding that an “earned bonus constitute[s] a ‘wage’ for the purpose of Minn. Stat. § 181.13”).10 When an employer fails to remit earned but unpaid wages the employee can demand those wages in writing, at which point they must be paid within twenty-four hours. § 181.14(2). The failure to make a timely payment results in a civil penalty “equal to the amount of the employee’s average daily earnings at the employee’s regular rate of pay . . . not exceeding 10 Section 181.13 uses the same “wages or commissions” language as used in section 181.14. “These two statutory provisions must be read together.” Chatfield v. Henderson, 90 N.W.2d 227, 232 (Minn. 1958). 20 No. 14-3356 15 days in all.” § 181.14(2). The penalty is mandatory and there is no minimum dollar threshold for its enforcement. Kilton v. Richard G. Nadler & Associates, 447 N.W.2d 468, 471 (Minn. Ct. App. 1989). Thus, TCP is liable for civil penalties pursuant to § 181.14 of the Minnesota Statutes.