Existing law provides for a civil penalty, in addition to, and entirely independent and apart from other penalties, on every person who fails to pay the wages of each employee, as specified, and requires the Labor Commissioner to recover that penalty. Existing law requires that a specified percentage of the penalty recovered under that provision be paid into a fund within the Labor and Workforce Development Agency dedicated to educating employers about state labor laws and that the remainder be paid into the State Treasury to the credit of the General Fund.

This bill would repeal those provisions and instead make an employer or other person acting individually or as an officer, agent, or employee of another person on behalf of an employer, as described, who fails to pay or causes a failure to pay specified wages of each employee subject to a penalty of $200, payable to each affected employee, per pay period where the wages due are not paid on time, as specified. The bill would provide that the additional penalty does not apply to the failure to pay the final wages of an employee who is discharged or quits.

Existing law makes an employer or other person acting individually or as an officer, agent, or employee of another person who fails to pay or causes a failure to pay an employee a wage less than the minimum wage subject to citation by the Labor Commissioner, a civil penalty, restitution of wages, liquidated damages, and certain other applicable penalties.

This bill would specify that those remedies also apply where when an employer or other person acting individually or as an officer, agent, or employee of another person fails to pay or causes a failure to timely pay an employee the regular wages due owed to that employee. employee when due. The bill would make other related conforming changes.

Existing law requires that employers pay wages to their employees, twice per calendar month, on days designated in advance as regular paydays. However, employees defined as executive, administrative, or professional may be paid once per month. Existing law makes a violation of these provisions a misdemeanor and subject to civil penalties recovered by the Labor Commissioner.

This bill would additionally impose specified penalties, payable to the affected employees, on employers who violate these provisions. The bill would require those penalties to be recovered by the Labor Commissioner as part of a hearing held to recover unpaid wages and penalties or by an employee in a civil action for wages.

ASSEMBLY THIRD READING

ATR Bill Id:AB 2613

Author:(Reyes)

As Amended Ver:May 29, 2018

Majority vote

SUMMARY: Repeals and revises existing penalties for failure to pay wages to an employee. Specifically, this bill:

1. Repeals existing penalty provisions that allow for a $100 penalty for late wage payments and then $200 for each additional violation. The revenue from this repealed penalty is paid to the Labor and Workforce Development Agency and the General Fund (GF).
2. Makes an employer or other person acting on behalf of an employer who fails to pay specified wages of each employee subject to a penalty of $200, payable to each affected employee, per pay period where the wages due are not paid on time, as specified.
3. Excludes an isolated or unintentional payroll error due to a clerical or inadvertent mistake from this new penalty provision.
4. Provides that the new penalty does not apply to the failure to pay the final wages of an employee who is discharged or quits.
5. Makes an employer or other person acting either individually or as an officer, agent, or employee of another person who fails to pay or causes a failure to pay a wage less than the regular wages owed to an employee, when due, subject to citation by the Labor Commissioner (LC), a civil penalty, restitution of wages, liquidated damages payable to the employee and certain other applicable penalties.

FISCAL EFFECT: According to the Assembly Appropriations Committee, possible penalty revenue loss resulting in a corresponding reduction of revenue to the Labor and Workforce Development Fund and the GF. However, the Division of Labor Standards Enforcement (DLSE) indicates this loss will be minimal because these penalties are rarely collected.

Special fund costs in excess of $150,000 each year to DLSE as a result of the additional workload from the new penalty structure and new claims for liquidated damages. DLSE processes an average 34,000 to 36,000 wage claims each year, and nearly a third of these contain late payment issues. This bill will add additional complexity and time to process these wage claims. 

COMMENTS: When an employer fails to pay wages the employer owes to an employee, the employee has the right to file a claim with the DLSE, which is directed by the LC. After conducting an investigation, the LC may hold an administrative conference or hearing. If a party is unhappy with the LC's decision, it can appeal to the appropriate civil court. Other potential remedies for employees include filing a lawsuit under the Fair Labor Standards Act (FLSA) or filing a claim under California law to recover unpaid minimum wages plus an equal amount as liquidated damages.

According to the author while there are currently penalties surrounding late payments of last checks, "similar provisions for late payment of wages while an employee is still employed by the business do not exist. This bill would provide particular mechanisms through the LC for employees who have received late payment of wages. A lack of penalty operates as an incentive for businesses to not always pay employees on time. This can cause employees who are living paycheck to paycheck to truly suffer, leading to situations such as eviction because of inability to pay rent."

Arguments in Support

Co-sponsors of this bill, California Employment Lawyers Association (CELA), Legal Aid at Work and the Center for Workers' Rights, write in support that their attorneys, "repeatedly see the devastating impact late paychecks have on low-wage workers. In one San Francisco case

involving a popular restaurant where wages all too often were paid late, several workers have had to pay their rent, student loans, and other bills late, incurring late fees and interest charges, damaging their credit, and facing the ongoing costs of that damaged credit. One of those workers was threatened with eviction proceedings if his rent continued to arrive late. These financial predicaments create an unnecessary stress and anxiety for workers whose lives are stressful enough without the unpredictability and chaos created by late paychecks."

The co-sponsors argue, "The problem is that employees who are paid late have no clear or effective recourse. At present, an employee could file a lawsuit under the Fair Labor Standards Act (FLSA) to recover the unpaid wages plus an equal amount as liquidated damages, as well as prejudgment interest…The employee could also file a claim under California Labor Code sections 1194 and 1194.2 to recover unpaid minimum wages plus an equal amount as liquidated damages." The co-sponsors argue though that "these efforts are often not realistic for employees who simply want to be paid on time and be compensated for the losses caused by the late payments." The co-sponsor also assert that while Labor Code Section 210 provides an enforcement mechanism for employers that do not pay their workers on time, it is only enforceable through an independent action by the Labor Commissioner and any penalties recovered go to the State, not the aggrieved worker. The co-sponsors go on to assert, "Because of these limitations, that provision is simply never utilized. That leaves employers with little or no incentive to pay on time. In effect, it turns workers, and particularly low-wage workers, into involuntary subprime lenders of first resort."

Arguments in Opposition

The Chamber of Commerce and others write in opposition to this measure, "California already has some of the most onerous and complex labor laws in the country. This complexity is exemplified by the duplicative penalty provisions contained in the Labor Code. With this statutory scheme, one, unintentional and minor violation of the Labor Code can result in the threat of financially devastating civil litigation against an employer. AB 2613 amends Section 210 of the Labor Code and allows for a penalty of $200, payable to each affected employee, per pay period where the wages due are not paid on time. The penalties will continue to accumulate for years, even for a minor and unintentional violation."

The Chamber and others continue, "While the May 29th amendments attempt to address the intentional versus unintentional violation, the language does not go far enough to remedy these concerns. The language states that a 'failure to pay' does not include an isolated or unintentional payroll error due to a clerical or inadvertent mistake (emphasis added). This language represents a narrow exemption, but does not take into consideration other unintentional errors that could capture miscalculations of a pay rate or other instances in which an employer will be forced to defend itself from a claim whose financial penalty could vastly outweigh the "harm" caused by an underpayment."

The Chamber and others argue that while paying wages when due seems like a simple requirement it is increasingly difficult in California and "recent cases demonstrate the challenge employers have in determining the appropriate calculation and payment of wages, such as overtime" and that "imposing another layer of penalties for failure to pay wages when it is unclear what the proper calculation of wages may be can only be described as simply unfair and overly punitive."

Analysis Prepared by: Jennifer Richard / L. & E. / (916) 319-2091 FN: 0003408

ASSEMBLY THIRD READING

ATR Bill Id:AB 2613

Author:(Reyes)

As Amended Ver:April 9, 2018

Majority vote

SUMMARY: Repeals and revises existing penalties for failure to pay an employee. Specifically, this bill:

1. Makes an employer or other person acting individually or as an officer, agent, or employee of another person who fails to pay or causes a failure to pay specified wages of each employee subject to a penalty of $200, payable to each affected employee, per pay period where the wages due are not paid on time, as specified.
2. Provides that the additional penalty does not apply to the failure to pay the final wages of an employee who is discharged or quits.
3. Specifies that those remedies also apply where an employer or other person acting individually or as an officer, agent, or employee of another person.

FISCAL EFFECT: According to the Assembly Appropriations Committee, possible penalty revenue loss resulting in a corresponding reduction of revenue to the Labor and Workforce Development Fund and the general fund (GF). However, the Division of Labor Standards Enforcement (DLSE) indicates this loss will be minimal because these penalties are rarely collected.

Special fund costs in excess of $150,000 each year to DLSE as a result of the additional workload from the new penalty structure and new claims for liquidated damages. DLSE processes an average 34,000 to 36,000 wage claims each year, and nearly a third of these contain late payment issues. This bill will add additional complexity and time to process these wage claims. 

COMMENTS: When an employer fails to pay wages the employer owes to an employee, the employee has the right to file a claim with the Department of Labor Standards Enforcement (DLSE), which is directed by the Labor Commissioner (LC). After conducting an investigation, the LC may hold an administrative conference or hearing. If a party is unhappy with the LC's decision, it can appeal to the appropriate civil court. Other potential remedies for employees include filing a lawsuit under the Fair Labor Standards Act (FLSA) or filing a claim under California law to recover unpaid minimum wages plus an equal amount as liquidated damages.

According to the author while there are currently penalties surrounding late payments of last checks, "similar provisions for late payment of wages while an employee is still employed by the business do not exist. This bill would provide particular mechanisms through the LC for employees who have received payment of wages. A lack of penalty operates as an incentive for businesses to not always pay employees on time. This can cause employees who are living paycheck to paycheck to truly suffer, leading to situations such as eviction because of inability to pay rent."

Arguments in Support

Co-sponsors of this bill, California Employment Lawyers Association (CELA), Legal Aid at Work and the Center for Workers' Rights, write in support that their attorneys, "repeatedly see the devastating impact late paychecks have on low-wage workers. In one San Francisco case

involving a popular restaurant where wages all too often were paid late, several workers have had to pay their rent, student loans, and other bills late, incurring late fees and interest charges, damaging their credit, and facing the ongoing costs of that damaged credit. One of those workers was threatened with eviction proceedings if his rent continued to arrive late. These financial predicaments create an unnecessary stress and anxiety for workers whose lives are stressful enough without the unpredictability and chaos created by late paychecks."

The co-sponsors argue, "The problem is that employees who are paid late have no clear or effective recourse." At present, an employee could file a lawsuit under the Fair Labor Standards Act (FLSA) to recover the unpaid wages plus an equal amount as liquidated damages, as well as prejudgment interest…The employee could also file a claim under California Labor Code sections 1194 and 1194.2 to recover unpaid minimum wages plus an equal amount as liquidated damages." The co-sponsors argue though that "these efforts are often not realistic for employees who simply want to be paid on time and be compensated for the losses caused by the late payments." The co-sponsor also assert that while Labor Code Section 210 provides an enforcement mechanism for employers that do not pay their workers on time, it is only enforceable through an independent action by the Labor Commissioner and any penalties recovered go the State, not the aggrieved worker. They go on to state, "Because of these limitations, that provision is simply never utilized. That leaves employers with little or no incentive to pay on time. In effect, it turns workers, and particularly low-wage workers, into involuntary subprime lenders of first resort."

Arguments in Opposition

The Chamber of Commerce and others write in opposition to this measure arguing, "Would impose Labor Code penalties for wage statement violations in addition to the penalties already available under the Private Attorneys General Act (PAGA). Per Labor Code Section 204, employers are required to pay and provide wage statements to non-exempt employees twice per month on designated and regular paydays. Any overtime hours worked must be paid no later than the payday for the next regular pay period. If the employer violates Labor Code Section 204, the employee can seek PAGA penalties."

Furthermore they argue, "California has some of the most onerous and complex labor laws in the country. This complexity is exemplified by PAGA, which allows an individual to pursue a "representative action” on behalf of similarly aggrieved employees without being subject to the strict filing requirements of a class action. The employee can pursue a claim against an employer for almost any Labor Code violation. PAGA requires a $100 penalty per employee, per pay period for the first violation, and $200 per employee, per pay period for each subsequent violation. If there are multiple Labor Code violations, then these penalties are stacked. In addition, if the employee recovers any dollar amount, the employee is entitled to attorney's fees, which adds another layer of cost onto the employer." Finally, they contend, "With this statutory scheme, one unintentional and minor violation of the Labor Code can result in the threat of financially devastating civil litigation against an employer, which the plaintiff's bar has utilized to leverage quick monetary settlements." There already are remedies for a failure to pay wages and that "Intentional wage theft is reprehensible, but unintentional, minor violations should not be subject to additional and drastic penalties as proposed by this bill."

Analysis Prepared by: Jennifer Richard / L. & E. / (916)319-2091 FN: 0003108

Date of Hearing: April 18, 2018

ASSEMBLY COMMITTEE ON LABOR AND EMPLOYMENT

Tony Thurmond, Chair

ABPCA Bill Id:AB 2613 (

Author:Reyes) – As Amended Ver:April 9, 2018

SUBJECT: Failure to pay wages: semimonthly payments: penalties

SUMMARY: Repeals and revises existing penalties for failure to pay an employee. Specifically, this bill:

1. Makes an employer or other person acting individually or as an officer, agent, or employee of another person who fails to pay or causes a failure to pay specified wages of each employee subject to a penalty of $200, payable to each affected employee, per pay period where the wages due are not paid on time, as specified.
2. Provides that the additional penalty does not apply to the failure to pay the final wages of an employee who is discharged or quits.
3. Specifies that those remedies also apply where an employer or other person acting individually or as an officer, agent, or employee of another person.

EXISTING LAW:

1. Provides for a civil penalty, in addition to, and entirely independent and apart from other penalties, on every person who fails to pay the wages of each employee, as specified, and requires the Labor Commissioner (LC) to recover that penalty.
2. Requires that a specified percentage of the penalty recovered under that provision be paid into a fund within the Labor and Workforce Development Agency(LWDA) dedicated to educating employers about state labor laws and that the remainder be paid into the State Treasury to the credit of the General Fund.
3. Makes an employer or other person acting individually or as an officer, agent, or employee of another person who fails to pay or causes a failure to pay an employee a wage less than the minimum wage subject to citation by the LC, a civil penalty, restitution of wages, liquidated damages, and certain other applicable penalties.

FISCAL EFFECT: Unknown

COMMENTS: According to the author while there are currently penalties surrounding late payments of last checks, “similar provisions for late payment of wages while an employee is still employed by the business do not exist. AB 2613 would provide particular mechanisms through the Labor Commissioner for employees who have received payment of wages. A lack of penalty operates as an incentive for businesses to not always pay employees on time. This can cause employees who are living paycheck to paycheck to truly suffer, leading to situations such as eviction because of inability to pay rent. “

The Problem of "Wage Theft"

Various recent studies have highlighted concerns about alleged widespread "theft of wages" in the United States and in California, particularly in the underground economy. For example, in 2009 the Ford Foundation sponsored a study that surveyed 4,387 workers in low-wage industries in the three largest U.S. cities – Chicago, Los Angeles and New York City. The study revealed that 26 percent of workers in the sample were paid less than the legally required minimum wage, and 60 percent of these workers were underpaid by more than $1 per hour. In addition, 76 percent of the respondents who worked overtime in the previous week were not paid the legally required overtime rate by their employers. (Broken Laws, Unprotected Workers: Violations of Employment and Labor Laws in America's Cities, Center for Urban Economic Development, National Employment Law Project, UCLA Institute for Research on Labor and Employment (2009).)

Another study focused on a survey of 1,815 workers in Los Angeles County. The survey found that low-wage workers in Los Angeles regularly experience violations of basic laws that mandate a minimum wage and overtime pay and are frequently forced to work off the clock or during their breaks. Other violations documented in the survey include lack of required payroll documentation, late payments, stealing tips, and employer retaliation. (Milkman, Gonzalez and Narro, Wage Theft and Workplace Violation in Los Angeles: The Failure of Employment and Labor Law for Low-Wage Workers, UCLA Institute for Research on Labor and Employment (2010).) The survey also revealed that the various forms of nonpayment and underpayment of wages take a heavy monetary toll on workers and their families. Respondents who experienced a pay-based violation in the previous work week lost an average of $39.81 out of average weekly earnings of $318.00 (or 12.5 percent). Assuming a full-year work schedule, these workers lost an average of $2,070.00 annually out of total earnings of $16,536.00. The survey estimated that, in a given week, 654,914 workers in Los Angeles County suffer at least one pay-based violation. Extrapolating from this figure, front-line workers in low-wage industries lose more than $26.2 million per week as a result of employment and labor law violations.

Effectiveness of Existing Methods of Recovering Unpaid Wages

Under existing law, when an employer fails to pay wages due, the employee has the right to file a claim against his or her employer (or former employer) with the Department of Labor Standards Enforcement (DLSE), which is directed by the State Labor Commissioner. The Labor Commissioner has jurisdiction over most private sector employees, except those that are bona fide independent contractors. In some cases, according to case law, the Commissioner does not have jurisdiction over those working under collective bargaining agreements. Existing law requires an employee who feels that his or her wages have been wrongly withheld must go through DLSE and according to statutorily prescribed procedures. (Labor Code Section 98 et seq.) After conducting an investigation, the Labor Commissioner may hold an administrative conference or hearing, or both. If a party is unhappy with the Commissioner's decision, it can appeal to the appropriate civil court. (Labor Code Section 98.2.) However, even where a worker wins a favorable decision, the process of collecting the award is often difficult and ineffective. Irresponsible employers may have already hidden their cash assets, declared bankruptcy, or otherwise become judgment-proof.

Equally troubling, if not more troubling, than the high rate of wage theft in California is the low rate of collections. According to a 2013 report published by the National Employment Law Project (NELP) and the UCLA Labor Center, only 17% of workers who prevailed in their wage claim before the DLSE and won a judgment were able to receive any payment between 2008 and 2011. Of those who did receive payment between 2008 and 2011, workers were able to collect 15% of what was owed. In short, the vast majority of wage theft victims received nothing, and those that received anything received little of what they were legally due.

Arguments in Support

Co-sponsors of this bill, California Employment Lawyers Association (CELA), Legal Aid at Work and the Center for Workers’ Rights, write in support that their attorneys, “repeatedly see the devastating impact late paychecks have on low-wage workers. In one San Francisco case

involving a popular restaurant where wages all too often were paid late, several workers have had to pay their rent, student loans, and other bills late, incurring late fees and interest charges, damaging their credit, and facing the ongoing costs of that damaged credit. One of those workers was threatened with eviction proceedings if his rent continued to arrive late. These financial predicaments create an unnecessary stress and anxiety for workers whose lives are stressful enough without the unpredictability and chaos created by late paychecks.”

The co-sponsors argue, “The problem is that employees who are paid late have no clear or effective recourse.” At present, an employee could file a lawsuit under the Fair Labor Standards Act (FLSA) to recover the unpaid wages plus an equal amount as liquidated damages, as well as prejudgment interest…The employee could also file a claim under California Labor Code sections 1194 and 1194.2 to recover unpaid minimum wages plus an equal amount as liquidated damages.” The co-sponsors argue though that “these efforts are often not realistic for employees who simply want to be paid on time and be compensated for the losses caused by the late payments.”

The co-sponsor also assert that while Labor Code Section 210 provides an enforcement mechanism for employers that do not pay their workers on time, it is only enforceable through an independent action by the Labor Commissioner and any penalties recovered go the State, not the aggrieved worker. They go on to state, “Because of these limitations, that provision is simply never utilized. That leaves employers with little or no incentive to pay on time. In effect, it turns workers, and particularly low-wage workers, into involuntary subprime lenders of first resort.”

Arguments in Opposition

The Chamber of Commerce and others write in opposition to this measure arguing, "Would impose Labor Code penalties for wage statement violations in addition to the penalties already available under the Private Attorneys General Act (PAGA).

Per Labor Code Section 204, employers are required to pay and provide wage statements to non-exempt employees twice per month on designated and regular paydays. Any overtime hours worked must be paid no later than the payday for the next regular pay period. If the employer violates Labor Code Section 204, the employee can seek PAGA penalties."

Furthermore they argue, "California has some of the most onerous and complex labor laws in the country. This complexity is exemplified by PAGA, which allows an individual to pursue a “representative action” on behalf of similarly aggrieved employees without being subject to the strict filing requirements of a class action. The employee can pursue a claim against an employer for almost any Labor Code violation. PAGA requires a $100 penalty per employee, per pay period for the first violation, and $200 per employee, per pay period for each subsequent violation. If there are multiple Labor Code violations, then these penalties are stacked. In addition, if the employee recovers any dollar amount, the employee is entitled to attorney’s fees, which adds another layer of cost onto the employer."

Finally, they contend, "With this statutory scheme, one unintentional and minor violation of the Labor Code can result in the threat of financially devastating civil litigation against an employer, which the plaintiff’s bar has utilized to leverage quick monetary settlements." There already are remedies for a failure to pay wages and that “Intentional wage theft is reprehensible, but unintentional, minor violations should not be subject to additional and drastic penalties as proposed by this bill.”

Prior Related Legislation

SB 588 (DeLeon), Chapter 803, Statutes of 2015. Allowed the LC to file a lien or levy on an employer’s property in order to assist the employee in collecting unpaid wages when there is a judgment against the employer.

REGISTERED SUPPORT / OPPOSITION:

Support

Bet Tzedek Legal Services

CA Conference Board of the Amalgamated Transit Union

CA Conference of Machinists

California Employment Lawyers Association (cosponsor)

California Immigrant Policy Center

California Labor Federation, AFL-CIO

California State Association for Electrical Workers

California State Pipes Trades Council

California Teamsters Public Affairs Council

Center for Workers' Rights (cosponsor)

Engineers and Scientists of CA, Local 20

International Longshore & Warehouse Union

International Union of Elevator Contractors

Koreatown Immigrant Workers Alliance

Legal Aid at Work (cosponsor)

Professional and Technical Engineers, Local 21

SEIU California

UNITE-HERE

Utility Workers of America

Western States Council of Sheet Metal Workers

Opposition

Associated Builders and Contractors Association, Inc. – Central California Chapter

Associated Builders and Contractors Association, Inc. – Northern California Chapter

Associated Builders and Contractors Association, Inc. – San Diego Chapter

Associated Builders and Contractors Association, Inc. – Southern California

Associated General Contractors

Brea Chamber of Commerce

California Ambulance Association

California Apartment Association

California Association for Health Services at Home

California Association of Winegrape Growers

California Bankers Association

California Beer and Beverage Distributors

California Chamber of Commerce

California Farm Bureau Federation

California Hotel and Lodging Association

California League of Food Producers

California Manufacturers and Technology Association

California Retailers Association

California State Association of Counties

Camarillo Chamber of Commerce

Citizens Against Lawsuit Abuse

Civil Justice Association of California

Construction Employers’ Association

Greater Coachella Valley Chamber of Commerce

Greater San Fernando Valley Chamber of Commerce

Job Creators for Workplace Fairness

National Federation of Independent Business

North Orange County Chamber

Official Police Garages of Los Angeles

Rancho Cordova Chamber of Commerce

Santa Maria Valley Chamber of Commerce

Oppose Unless Amended

California Building Industry Association

Analysis Prepared by: Jennifer Richard / L. & E. /

Date of Hearing: May 2, 2018

ASSEMBLY COMMITTEE ON APPROPRIATIONS

Lorena Gonzalez Fletcher, Chair

ABPCA Bill Id:AB 2613

Author:(Reyes) – As Amended Ver:April 9, 2018

Urgency: No State Mandated Local Program: No Reimbursable: No

SUMMARY:

This bill repeals and revises penalties for failure to pay an employee. Specifically, this bill:

1. Makes an employer, or a person acting in a specified capacity, who fails to pay specified wages on time subject to a $200 penalty payable to the affected employee. This penalty is per each pay period during which wages are not paid on time.
2. Repeals existing penalty provisions that allow for a $100 penalty for late wage payments and then $200 for each additional violation. The revenue from this repealed penalty is paid to the Labor and Workforce Development Agency and the General Fund (GF).
3. Specifies that an employee who is paid a wage less than the regular wages is entitled to liquidated damages equal to the amount of wages, with interest, unlawfully unpaid.

FISCAL EFFECT:

1. Possible penalty revenue loss resulting in a corresponding reduction of revenue to the Labor and Workforce Development Fund and the GF. However, the Division of Labor Standards Enforcement (DLSE) indicates this loss will be minimal because these penalties are rarely collected.
2. Special fund costs in excess of $150,000 each year to DLSE as a result of the additional workload from the new penalty structure and new claims for liquidated damages. DLSE processes an average 34,000 to 36,000 wage claims each year, and nearly a third of these contain late payment issues. This bill will add additional complexity and time to process these wage claims.

COMMENTS:

Background and purpose. When an employer fails to pay wages the employer owes to an employee, the employee has the right to file a claim with DLSE, which is directed by the Labor Commissioner (LC). After conducting an investigation, the LC may hold an administrative conference or hearing. If a party is unhappy with the LC’s decision, it can appeal to the appropriate civil court. Other potential remedies for employees include filing a lawsuit under the Fair Labor Standards Act (FLSA) or filing a claim under California law to recover unpaid minimum wages plus an equal amount as liquidated damages.

According to supporters, AB 2613 will provide a mechanism through the Labor Commissioner to incentivize business to pay employees on time. Supporters note that the penalty AB 2613 replaces is ineffective and redirects penalties to the state rather than the aggrieved worker.

Analysis Prepared by: Luke Reidenbach / APPR. / (916) 319-2081