Wage Theft in MD
In Maryland, what are the consequences of a subcontractor failing to pay their employees?
Maryland, like Virginia, has laws protecting employees from a subcontractor withholding their wages. This action is also known as wage theft. Withholding wages can lead to both the contractors and the subcontractors being jointly and severally liable for the subcontractor’s failure to pay their employees. The subcontractor then must indemnify the contractor, but unlike Virginia if the subcontractor is insolvent all the liability will then fall to the general contractor. For a knowing violation the court can award the employee up to three times the amount of the unpaid wages and attorney’s fees. Carefully drafted contract provisions can help to protect a contractor from a subcontractor’s failure to pay wages.