Chapter 109

CHAPTER 109

WAGE PAYMENTS, CLAIMS AND COLLECTIONS

109.01   Definitions.

109.015   Franchisors excluded.

109.03   When wages payable; pay orders.

109.07   Mergers, liquidations, dispositions, relocations or cessation of operations affecting employees; advance notice required.

109.075   Cessation of health care benefits affecting employees, retirees and dependents; advance notice required.

109.09   Wage claims, collection.

109.10   Reciprocal agreements.

109.11   Penalties.

109.12   Rules and report.

Ch. 109 Note NOTE: Ch. 380, laws of 1975, which created this chapter, contains explanatory notes. These notes also are in statutes prior to the 1983-84 edition.

109.01 109.01 Definitions. As used in this chapter:

109.01(1) (1) “Department” means the department of workforce development.

109.01(1r) (1r) “Employee” means any person employed by an employer, except that “employee” does not include an officer or director of a corporation, a member or manager of a limited liability company, a partner of a partnership or a joint venture, the owner of a sole proprietorship, an independent contractor or person otherwise excluded under s. 452.38, or a person employed in a managerial, executive, or commissioned sales capacity or in a capacity in which the person is privy to confidential matters involving the employer-employee relationship.

109.01(2) (2) Except as provided in ss. 109.07 (1) (d) and 109.075 (1) (c), “employer” means any person engaged in any activity, enterprise or business employing one or more persons within the state, including the state and its political subdivisions and charitable, nonprofit or tax-exempt organizations and institutions.

109.01(3) (3) “Wage” or “wages” mean remuneration payable to an employee for personal services, including salaries, commissions, holiday and vacation pay, overtime pay, severance pay or dismissal pay, supplemental unemployment benefit plan payments when required under a binding collective bargaining agreement, bonuses and any other similar advantages agreed upon between the employer and the employee or provided by the employer to the employees as an established policy.

109.01(4) (4) “Wage deficiency” means the difference between the amount required by law to be paid and the amount actually paid to an employee.

109.01 History History: 1975 c. 380, 421; 1989 a. 44; 1995 a. 27 s. 9130 (4); 1997 a. 3, 39, 237; 2003 a. 63; 2015 a. 258.

109.01 Annotation “Wages” does not include salary owed under a fixed term contract to a discharged employee for the period from the discharge to the end of the contract. DILHR v. Coatings, Inc., 126 Wis. 2d 338, 375 N.W.2d 834 (1985).

109.01 Annotation Sub. (3) includes vacation pay, supplemental unemployment benefit plan payments, severance pay or dismissal pay as wages. Sub. (3) does not require that the employee perform actual work during the time period for which he is making a wage claim. Such a requirement would foreclose any employees’ wage claims for vacation pay, supplemental unemployment benefit plan payments, severance pay, or dismissal pay because in each case the employee is not performing actual work during the time period of the claim. Sliwinski v. City of Milwaukee, 2009 WI App 162, 321 Wis. 2d 774, 777 N.W.2d 88, 08-2141.

109.015 109.015 Franchisors excluded. For purposes of this chapter, a franchisor, as defined in 16 CFR 436.1 (k), is not considered to be an employer of a franchisee, as defined in 16 CFR 436.1 (i), or of an employee of a franchisee, unless any of the following applies:

109.015(1) (1) The franchisor has agreed in writing to assume that role.

109.015(2) (2) The franchisor has been found by the department to have exercised a type or degree of control over the franchisee or the franchisee’s employees that is not customarily exercised by a franchisor for the purpose of protecting the franchisor’s trademarks and brand.

109.015 History History: 2015 a. 203.

109.03 109.03 When wages payable; pay orders.

109.03(1) (1) Required frequency of payments. Every employer shall as often as monthly pay to every employee engaged in the employer’s business, except those employees engaged in logging operations and farm labor, all wages earned by the employee to a day not more than 31 days prior to the date of payment. Employees engaged in logging operations and farm labor shall be paid all earned wages no less often than at regular quarterly intervals. Any employee who is absent at the time fixed for payment or who for any other reason is not paid at that time shall be paid thereafter at any time upon 6 days’ demand. The required frequency of wage payments provided in this subsection does not apply to any of the following:

109.03(1)(a) (a) Employees covered under a valid collective bargaining agreement establishing a different frequency for wage payments, including deferred payments exercised at the option of employees.

109.03(1)(b) (b) School district employees, cooperative educational service agency employees, and private school employees who voluntarily request payment over a 12-month period for personal services performed during the school year, unless, with respect to private school employees, the employees are covered under a valid collective bargaining agreement which precludes this method of payment.

109.03(1)(c) (c) Employees of the University of Wisconsin System other than university staff, as defined in s. 36.05 (15).

109.03(1)(d) (d) Employees who receive compensatory time off under s. 103.025 in lieu of overtime compensation.

109.03(1)(e) (e) A part-time fire fighter or a part-time emergency medical services practitioner, as defined in s. 256.01 (5), who is a member of a volunteer fire department or emergency medical services program maintained by a county, city, village, or town or of a volunteer fire company organized under ch. 181 or ch. 213 and who, by agreement between the fire fighter or emergency medical services practitioner and the entity employing the fire fighter or emergency medical services practitioner, is paid at regular intervals, but no less often than annually.

109.03(2) (2) Payment to discharged or resigned employees. Any employee, except a sales agent employed on a commission basis, not having a written contract for a definite period, who quits employment or who is discharged from employment shall be paid in full by no later than the date on which the employee regularly would have been paid under the employer’s established payroll schedule or the date of payment required under sub. (1), whichever is earlier.

109.03(3) (3) Payment upon death of employee.

109.03(3)(a) (a) In case of the death of an employee to whom wages are due, the full amount of the wages due shall upon demand be paid by the employer to the spouse, domestic partner under ch. 770, children, or other dependent living with the employee at the time of death.

109.03(3)(b) (b) An employer may, not less than 5 days after the death of an employee and before the filing of a petition or application for administration of the decedent’s estate, make payments of the wage due the deceased employee to the spouse, domestic partner under ch. 770, children, parents, or siblings of the decedent, giving preference in the order listed.

109.03(3)(c) (c) If none of the persons listed in par. (b) survives, the employer may apply the payment of the wage or so much of the wage as may be necessary to paying creditors of the decedent in the order of preference prescribed in s. 859.25 for satisfaction of debts by personal representatives.

109.03(3)(d) (d) The making of payment in the manner described in this subsection shall discharge and release the employer to the amount of the payment.

109.03(4) (4) Payment to certain separated employees. Whenever an employee is separated from the payroll of an employer as a result of the employer merging, liquidating or otherwise disposing of the business, ceasing business operations in whole or in part, or relocating all or part of the business to another area within or without the state, the employer, or the successors in interest of the employer, shall pay all unpaid wages to the employee at the usual place of payment within 24 hours of the time of separation.

109.03(5) (5) Enforcement. Except as provided in sub. (1), no employer may by special contract with employees or by any other means secure exemption from this section. Each employee shall have a right of action against any employer for the full amount of the employee’s wages due on each regular pay day as provided in this section and for increased wages as provided in s. 109.11 (2), in any court of competent jurisdiction. An employee may bring an action against an employer under this subsection without first filing a wage claim with the department under s. 109.09 (1). An employee who brings an action against an employer under this subsection shall have a lien upon all property of the employer, real or personal, located in this state as described in s. 109.09 (2).

109.03(6) (6) Wage claim. In an action by an employee or the department against the employer on a wage claim, no security for payment of costs is required. In any such proceeding the court may allow the prevailing party, in addition to all other costs, a reasonable sum for expenses. No person other than an employee or the department shall be benefited or otherwise affected by this subsection.

109.03(7) (7) Protection of employees. Section 111.322 (2m) applies to discharge and other discriminatory acts arising in connection with any proceeding under this section.

109.03 History History: 1975 c. 380, 421; 1977 c. 26, 235, 447; 1981 c. 20, 388; 1987 a. 403; 1989 a. 226, 228; 1993 a. 86, 144; 2001 a. 102, 103; 2007 a. 7, 195; 2009 a. 28; 2011 a. 10; 2015 a. 55; 2017 a. 12; 2021 a. 144.

109.03 Annotation The award of “expenses” under sub. (6) may include attorney fees. Jacobson v. American Tool Cos., Inc., 222 Wis. 2d 384, 588 N.W.2d 67 (Ct. App. 1998), 97-2219.

109.03 Annotation The inclusion of “the state” in the definition of employer at s. 109.01 (2) and the creation of a private cause of action against employers under sub. (5) is a waiver of the state’s sovereign immunity. Claims under statutes enumerated in s. 109.09 (1) may be enforced by a private action brought under sub. (5). German v. DOT, 223 Wis. 2d 525, 589 N.W.2d 651 (Ct. App. 1998), 98-0250.

109.03 Annotation Affirmed. 2000 WI 62, 235 Wis. 2d 576, 612 N.W.2d 50, 98-0250.

109.03 Annotation When an employer repudiates the contractual remedies of a collective bargaining agreement, employees are allowed to proceed under this chapter if they are seeking back pay. Beaudette v. Eau Claire County Sheriff’s Department, 2003 WI App 153, 265 Wis. 2d 744, 668 N.W.2d 133, 02-2916.

109.03 Annotation In determining a reasonable attorney fee under sub. (6), a court starts by determining a reasonable hourly rate and number of hours, then makes adjustments for other factors in SCR 20:1.5 (a) or any other relevant factors. The court may use its own firsthand knowledge of the proceeding in determining the number of hours reasonably expended. The amount recovered in itself is not a reason to reduce a fee below an amount that represents a reasonable hourly rate. Lynch v. Crossroads Counseling Center, Inc., 2004 WI App 114, 275 Wis. 2d 171, 684 N.W.2d 141, 03-1344.

109.03 Annotation Sub. (5) establishes a distinct cause of action and enforcement procedure for a wage claim, wholly apart from any contract claims. Merely pleading a contract action based on nonpayment of wages is insufficient to trigger a ch. 109 wage claim under notice pleading. Wolnak v. Cardiovascular & Thoracic Surgeons of Central Wisconsin, S.C., 2005 WI App 217, 287 Wis. 2d 560, 706 N.W.2d 667, 04-1051.

109.03 Annotation Appellate courts ordinarily defer to a circuit court’s determination as to hours awarded in allowing attorney fees. An attorney’s hours are subject to the scrutiny of the circuit court and unreasonable hours should not be compensated. Nonetheless, the appellate courts must probe the circuit court’s explanation to determine if the court employed a logical rationale based on the appropriate legal principles and facts of record. The record should show that the circuit court did not eyeball the fee request and cut it down by an arbitrary percentage because it seemed excessive. Johnson v. Roma II — Waterford LLC, 2013 WI App 38, 346 Wis. 2d 612, 829 N.W.2d 538, 12-1028.

109.03 Annotation Time spent in travel between home and work in an employer-supplied vehicle does not give rise to wages earned by an employee under sub. (1). Conveying company tools from an employee’s home to the employee’s jobsite, without more, does not make the employee’s travel time an integral part of a principal activity or a closely related activity that is indispensable to its performance. Kieninger v. Crown Equipment Corp., 2019 WI 27, 386 Wis. 2d 1, 924 N.W.2d 172, 17-0631.

109.03 Annotation Although Wisconsin’s wage law is modeled after the federal Fair Labor Standards Act (FLSA), there is no Wisconsin statute or regulation that is equivalent to 29 USC 203(o) of the FLSA, which specifically permits collective bargaining over compensation for donning and doffing. Sub. (5) provides that an employer may not contractually avoid its obligation to pay an employee for all compensable time. Therefore, under Wisconsin law, compensation for donning and doffing personal protective equipment cannot be modified or eliminated through collective bargaining. Piper v. Jones Dairy Farm, 2020 WI 28, 390 Wis. 2d 762, 940 N.W.2d 701, 18-1681.

109.03 Annotation Sub. (5), which outlines the right of an employee to bring a wage claim, is not a complete bar to an employer’s equitable defenses. Piper v. Jones Dairy Farm, 2020 WI 28, 390 Wis. 2d 762, 940 N.W.2d 701, 18-1681.

109.03 Annotation Wisconsin requires time spent donning and doffing safety gear to be compensated at the minimum wage or higher, and that this time counts toward the limit after which the overtime rate kicks in. Wisconsin law is not preempted by federal law. Spoerle v. Kraft Foods Global, Inc., 614 F.3d 427 (2010).

109.03 Annotation Attorney fees are awardable under sub. (6). Jackman v. WMAC Inv. Corp., 610 F. Supp. 290 (1985).

109.03 Annotation Wage claims against a governmental body under this section are exempt from the notice of claim requirements under s. 893.80. Gilbertson v. City of Sheboygan, 165 F. Supp. 3d 742 (2016).

109.03 Annotation Under regulations promulgated under s. 104.045 (1), an employer taking a tip credit must have a tip declaration signed by the tipped employee each pay period to show that, when adding the tips received to the wages paid by the employer, no less than the minimum rate was received by the employee. When the employer’s time and payroll records do not contain these requirements, no tip credit is allowed, and a plaintiff may pursue back wages under sub. (5) for alleged violations of such regulations. Hussein v. Jun-Yan, LLC, 502 F. Supp. 3d 1366 (2020).

109.07 109.07 Mergers, liquidations, dispositions, relocations or cessation of operations affecting employees; advance notice required.

109.07(1) (1) In this section:

109.07(1)(a) (a) “Affected employee” means an employee who loses, or who may reasonably be expected to lose, his or her employment with an employer that is required to give notice under sub. (1m) (a) because of the business closing or mass layoff.

109.07(1)(b) (b) “Business closing” means a permanent or temporary shutdown of an employment site or of one or more facilities or operating units at an employment site or within a single municipality that affects 25 or more employees, not including new or low-hour employees.

109.07(1)(c) (c) “Employee benefit plan” means a plan as defined in 29 USC 1002 (3).

109.07(1)(d) (d) “Employer” means any business enterprise that employs 50 or more persons in this state.

109.07(1)(e) (e) “Highest official” means the mayor of a city, town board chairperson or village president, except as follows:

109.07(1)(e)1. 1. For a city organized under subch. I of ch. 64, “highest official” means both the president of the city council and the city manager.

109.07(1)(e)2. 2. For a village organized under subch. I of ch. 64, “highest official” means both the president of the village board of trustees and the village manager.

109.07(1)(f) (f) “Mass layoff” means a reduction in an employer’s work force that is not the result of a business closing and that affects the following numbers of employees at an employment site or within a single municipality, not including new or low-hour employees:

109.07(1)(f)1. 1. At least 25 percent of the employer’s work force or 25 employees, whichever is greater; or

109.07(1)(f)2. 2. At least 500 employees.

109.07(1)(g) (g) “Municipality” means a city, village or town.

109.07(1)(h) (h) “New or low-hour employee” means an employee who has been employed by an employer for fewer than 6 of the 12 months preceding the date on which a notice is required under sub. (1m) (a) or who averages fewer than 20 hours of work per week.

109.07(1m) (1m) 

109.07(1m)(a) (a) Subject to sub. (5) or (6), an employer that has decided upon a business closing or mass layoff in this state shall promptly notify the subunit of the department that administers s. 106.15, any affected employee, any collective bargaining representative of any affected employee, and the highest official of any municipality in which the affected employment site is located, in writing of such action no later than 60 days prior to the date on which the business closing or mass layoff takes place. The notice to an affected employee shall also include contact information for the local workforce development board under 29 USC 2832 serving the area in which the employment site is located and, if available, the list of resources prepared under s. 106.11. The employer shall provide in writing all information concerning its payroll, affected employees, and the wages and other remuneration owed to those employees as the department may require. The department may in addition require the employer to submit a plan setting forth the manner in which final payment in full shall be made to affected employees.

109.07(1m)(b) (b) The department shall promptly provide a copy of the notice required under par. (a) to the office of the commissioner of insurance and shall cooperate with the office of the commissioner of insurance in the performance of its responsibilities under s. 601.41 (7).

109.07(1m)(c) (c) This subsection does not apply to a business closing or mass layoff that is caused by a strike or lockout.

109.07(3) (3) 

109.07(3)(a) (a) If an employer fails to give timely notice to an affected employee as required under sub. (1m) (a), the affected employee may recover, as provided under sub. (4), all of the following:

109.07(3)(a)1. 1. Pay, for the days during the recovery period described under par. (c) that the employee would have worked if the business closing or mass layoff had not occurred, based on the greater of the following:

109.07(3)(a)1.a. a. The employee’s regular rate of pay from the employer, averaged over the shorter of the 3-year period preceding the business closing or mass layoff or the entire period during which the employee was employed by the employer.

109.07(3)(a)1.b. b. The employee’s regular rate of pay from the employer at the time of the business closing or mass layoff.

109.07(3)(a)2. 2. The value of any benefit that the employee would have received under an employee benefit plan during the recovery period described under par. (c), but did not receive because of the business closing or mass layoff, including the cost of medical treatment incurred that would have been covered under the employee benefit plan.

109.07(3)(b) (b) The amount that an employee may recover under par. (a) shall be reduced by any cost that the employer incurs by crediting the employee, under an employee benefit plan, for time not actually served because of a business closing or mass layoff.

109.07(3)(c) (c) The recovery period under par. (a) begins on the day on which the business closing or mass layoff occurs. The recovery period equals the number of days in the period beginning on the day on which an employer is required to give notice under sub. (1m) (a) and ending on whichever of the following occurs first:

109.07(3)(c)1. 1. The day on which the employer actually gave the notice to the employee.

109.07(3)(c)2. 2. The day on which the business closing or mass layoff occurred.

109.07(4) (4) 

109.07(4)(a) (a) An employee whose employer fails to notify timely the employee under sub. (1m) (a) may file a claim with the department. If the employee files a claim with the department no later than 300 days after the day on which the business closing or mass layoff occurred, the department shall, in the manner provided in s. 109.09, investigate the claim, determine the number of days that the employer was late in providing notice and, on behalf of the employee, attempt to recover from the employer the payment under sub. (3).

109.07(4)(b) (b) If the department does not recover payment within 180 days after a claim is filed or within 30 days after it notifies the employee of its determination under par. (a), whichever is first, the department shall refer the claim to the department of justice. The department of justice may bring an action in circuit court on behalf of the employee to recover the payment under sub. (3).