Key Points

  • The Pennsylvania Supreme Court held 6-1 that the Wage Payment and Collection Law does not authorize an employee to sue solely for liquidated damages when the employer paid the late wages, with interest, before suit was filed.
  • The court read Section 260.9a(b)'s authorization of actions "to recover unpaid wages and liquidated damages" and Section 260.10's "in addition" language to require a claim for wages still unpaid at filing.
  • The court held that Section 260.9a(g)'s three-year limitations period, which refers to "unpaid wages or liquidated damages," does not create a freestanding liquidated-damages action, and found two unreported federal decisions unpersuasive.
  • The majority agreed with the employee that the phrase "to whom any type of wages is payable" in Section 260.9a(a) modifies only "party," but held that conclusion did not decide the case.
  • Justice Wecht dissented, writing that the decision hollows out the law's main prompt-payment enforcement mechanism.

Pennsylvania's highest court ruled on Thursday that workers cannot sue under the state's wage-payment law solely to collect its 25% late-payment penalty once the employer has paid the overdue wages, with interest, before the suit is filed. The decision reverses a ruling that had upheld a $60,000 award to a former chief executive of NCB Management Services Inc.

The Pennsylvania Supreme Court divided 6-1 in Aita v. NCB Management Services. Justice Mundy wrote for the majority, joined by Chief Justice Todd and Justices Donohue, Dougherty, Brobson and McCaffery. Justice Wecht dissented.

The ruling turns on the Wage Payment and Collection Law, which gives employees a cause of action against employers that miss paydays. The law separately provides liquidated damages, a statutory penalty equal to 25% of the wages due or $500, whichever is greater, when wages stay unpaid 30 days past the regular payday and the employer has no good-faith dispute over them. Under the decision, an employer that pays the arrears before the employee files suit cannot then be sued for the penalty.

The dispute began with a December 2014 bonus agreement. NCB agreed to pay Marcelo Aita, its CEO, $1,080,000 in 18 monthly retention installments of $60,000 each, and Aita qualified for all of them. According to the opinion, NCB paid the first six on time but fell behind on the rest "due to cash flow issues." It paid all but one of the missed installments, plus 6% interest, in a $660,000 lump sum in July 2017, and paid the last one with interest that October.

Aita, who resigned in July 2017, sued in Bucks County in February 2019. His complaint stated that "NCB has now paid the unpaid bonus, and interest due thereon, but remains liable for liquidated damages due under the WPCL and attorneys’ fees" incurred by him. He sought $180,000, a quarter of the $720,000 NCB had paid late. The trial court granted him summary judgment but awarded $60,000, finding the law's three-year limitations period barred recovery on all but four installments.

In 2024, a nine-judge en banc panel of the Superior Court affirmed by a 5-4 vote. The majority warned that under NCB's reading "an employer could drag its feet for months and escape liability for liquidated damages by finally paying the employee’s due and payable wages just before the employee files suit." Judge Bowes, writing for the four dissenters, responded that the law "was not written to protect dilatory enforcement."

Before the Supreme Court, NCB argued that the Superior Court's ruling "is little more than an aspirational interpretation of the law in an effort to effectuate its understanding of the WPCL’s remedial purpose." Aita, backed by the state Department of Labor and Industry as amicus curiae, argued that the violation occurs on the missed payday and that later payment does not erase it.

The majority sided with Aita on one point. Applying the last-antecedent rule, under which a limiting phrase at the end of a list ordinarily modifies only the item just before it, Justice Mundy concluded that the words "to whom any type of wages is payable" in the provision listing who may sue qualify only "party," not employees. But she wrote that this conclusion "ultimately does not resolve the issue before us."

The decisive text, the court held, is the subsection authorizing actions "to recover unpaid wages and liquidated damages." Relying on dictionary definitions of "recover" and "unpaid," Justice Mundy wrote that "the WPCL does not authorize an action to recover 'untimely paid' wages." She read the liquidated-damages section the same way. "Section 260.10 does not authorize a standalone claim for liquidated damages when the employee does not have a claim for unpaid wages," she wrote.

The majority also pointed to the law's separate 10% penalty, for which the Secretary of Labor and Industry has its own cause of action. That provision showed, Justice Mundy wrote, that lawmakers knew how to create a freestanding penalty claim, "but the legislature did not enact a similar provision for liquidated damages."

The court rejected the Superior Court's reliance on the limitations provision, which bars suits "for the collection of unpaid wages or liquidated damages" filed more than three years after the wages came due. "Section 260.9a(g) is plainly a statute of limitations provision, and it does not alter the cause of action that the legislature established in Section 260.9a(b)," Justice Mundy wrote. Two unreported federal district court decisions that had let similar claims proceed "did not discuss or analyze the provisions of Section 260.9a, so we do not find they are persuasive for our present purposes," she added.

Because NCB had paid everything it owed before Aita sued, the court concluded that he had no claim for unpaid wages when he filed. "We hold Aita’s standalone claim for liquidated damages was not permitted as a matter of law," Justice Mundy wrote.

Justice Wecht agreed with the majority's reading of the provision listing who may sue but not with the rest. He wrote that the majority drew its conclusion from "unremarkable text" and called its reasoning "an obvious non sequitur," because Aita sought liquidated damages, not untimely paid wages, and the subsection "authorizes actions to obtain liquidated damages." Reading "and" as strictly conjunctive, he added, would bar standalone suits for unpaid wages too, and the provisions on the Secretary of Labor and Industry "in no way speak to the scope of the (judicial) cause of action afforded to employees."

"Put simply, today’s decision hollows out the WPCL’s primary mechanism for ensuring that employers pay their workers on time," Justice Wecht wrote.

The court reversed the Superior Court's order, which had affirmed the trial court's denial of summary judgment to NCB and its grant of summary judgment to Aita. In the order that accepted NCB's appeal, the court had denied Aita's own petition for allowance of appeal. The case was argued March 12, 2026, under docket No. 25 MAP 2025.