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Wage Theft in California: Your Rights Explained

Posted by Eric Kingsley | Jun 19, 2024 | 0 Comments

Wage theft is a serious issue that affects countless workers across California. From not receiving overtime pay to being misclassified as an independent contractor, the ways employers can shortchange you are numerous. As someone who has faced these challenges firsthand or knows someone who has, it's crucial to understand your rights and the actions you can take.

Wage theft on folder

With so many businesses cutting corners at employees' expense, it's easy to feel overwhelmed and powerless. But you're not alone. Armed with knowledge and resources, you can stand up against wage theft.

Table of Contents:

What is Wage Theft and How Does it Occur in California?

Wage theft in California is a serious issue that affects thousands of workers every year. It happens when employers fail to pay their employees the full wages they're owed under state labor laws.

Common Examples of Wage Theft

Some of the most common examples of wage theft include:

  • Paying less than the state minimum wage
  • Not paying overtime rates for hours worked over 40 per week
  • Denying workers their legally mandated meal breaks and rest breaks
  • Requiring employees to work off-the-clock without pay
  • Taking a portion of workers' tips
  • Misclassifying employees as independent contractors to avoid paying benefits
  • Not reimbursing workers for necessary business expenses

California Labor Laws Protecting Workers

Fortunately, California has some of the strongest labor laws in the country to protect workers from wage theft. The state minimum wage is higher than the federal rate, and workers are entitled to overtime pay, paid sick leave, and reimbursement for business expenses. California's minimum wage has increased to $16.00 per hour for all employers since January 2024. Employers are also required to provide employees with meal breaks and rest breaks based on the number of hours worked.

Consequences for Employers Engaging in Wage Theft

Employers who engage in wage theft can face serious consequences under California law. They may be required to pay back wages, penalties, and interest to affected employees. In some cases, they can even face criminal charges for grand theft. According to a study by the Economic Policy Institute, California workers lose out on over $2 billion each year due to wage theft. That's why it's so important for employees to know their rights and take action if they suspect their employer is stealing their hard-earned wages.

Steps to Take if You're a Victim of Wage Theft in California

If you believe you're a victim of wage theft, the first step is to document everything. Keep detailed records of your hours worked, pay stubs, and any communication with your employer about your wages.

Documenting Evidence of Wage Theft

To build a strong case, you'll need evidence to support your claim. This may include:

  • Timesheets or logs of your hours worked
  • Pay stubs showing discrepancies in your wages
  • Copies of bounced checks from your employer
  • Witness statements from coworkers experiencing similar issues

The more documentation you have, the better your chances of recovering your stolen wages.

Filing a Wage Claim with the Labor Commissioner's Office

Once you have gathered your evidence, you can file a wage claim with the California Labor Commissioner's Office. This can be done online, by mail, or in person at a local office. The Labor Commissioner's Office will investigate your claim and may hold a hearing to determine if your employer owes you any unpaid wages. If they find in your favor, they can order your employer to pay you the money you're owed.

Seeking Legal Assistance from a Private Attorney or the Attorney General

In some cases, it may be necessary to seek legal assistance from a private attorney or the California Attorney General's Office. An experienced wage theft attorney can help you navigate the legal process and ensure your rights are protected. The Attorney General's Office also has the power to investigate and prosecute cases of widespread wage theft. They may take action against employers who engage in particularly egregious or systemic violations of California's labor laws.

The Role of the California Labor Commissioner's Office in Combating Wage Theft

The California Labor Commissioner's Office, also known as the Division of Labor Standards Enforcement (DLSE), plays a crucial role in combating wage theft and protecting workers' rights.

Investigating and Prosecuting Wage Theft Cases

The DLSE is responsible for investigating complaints of wage theft and other labor law violations. They have the authority to subpoena records, interview witnesses, and take legal action against employers who break the law. In recent years, the Labor Commissioner's Office has stepped up its enforcement efforts to crack down on wage theft. They have launched targeted investigations in high-risk industries like garment manufacturing, construction, and agriculture.

Enforcing Judgments Against Employers

When the DLSE finds that an employer has engaged in wage theft, they can issue a citation ordering the employer to pay back wages and penalties. If the employer fails to comply, the Labor Commissioner's Office can file a lawsuit to enforce the judgment. The DLSE's Judgment Enforcement Unit is responsible for collecting unpaid wages and penalties from employers who refuse to pay. They can place liens on an employer's property, garnish their bank accounts, or even seize their assets to satisfy a judgment.

Providing Resources and Assistance to Workers

In addition to its enforcement efforts, the Labor Commissioner's Office also provides resources and assistance to workers who have experienced wage theft. They offer information on workers' rights, help with filing wage claims, and referrals to other agencies or legal services. The DLSE also conducts outreach and education programs to inform workers about their rights and how to report violations. They have launched public awareness campaigns in multiple languages to reach vulnerable populations who may be at higher risk of wage theft.

Recent High-Profile Wage Theft Cases in California

Unfortunately, wage theft remains a widespread problem in California, affecting workers across many industries. Here are a few recent high-profile cases that illustrate the scope and impact of this issue:

Radisson Hotel Oakland Airport Wage Theft Case

In 2021, the California Labor Commissioner's Office cited the Radisson Hotel Oakland Airport for multiple wage theft violations, including failure to pay minimum wage, overtime, and split shift premiums. The hotel was ordered to pay over $200,000 in back wages and penalties to 14 affected workers. This case highlights how wage theft can occur even at well-known, seemingly reputable businesses. It also shows the importance of the Labor Commissioner's Office in holding employers accountable and recovering stolen wages for workers.

Misclassification of Independent Contractors

Another common form of wage theft is misclassifying employees as independent contractors to avoid paying minimum wage, overtime, and other benefits. This practice is particularly prevalent in the gig economy and industries like trucking and delivery services. In 2020, California passed Assembly Bill 5 (AB5), which created a stricter test for determining whether a worker is an employee or an independent contractor. The law aimed to combat misclassification and ensure more workers are protected by labor standards. However, some industries have pushed back against AB5, seeking exemptions or challenging the law in court. This ongoing battle highlights the complexity of the issue and the need for continued advocacy to protect workers' rights.

Wage Violations in the Garment Industry

The garment industry has long been plagued by wage theft and other labor abuses. Many garment workers are paid by the piece rather than hourly, which can result in sub-minimum wages and pressure to work long hours without breaks. In 2021, California passed the Garment Worker Protection Act (SB62), which aims to combat wage theft in the industry. The law makes fashion brands and garment manufacturers jointly liable for wage violations and prohibits piece-rate pay unless workers earn at least minimum wage. While SB62 is a step in the right direction, advocates say more must be done to address the root causes of wage theft in the garment industry, such as the pressure for fast fashion and low prices.

Preventing Wage Theft: Best Practices for California Employers

For employers in California, it's crucial to prioritize compliance with state labor laws and take proactive steps to prevent wage theft. Here are some best practices they should follow:

Maintaining Accurate Payroll Records

One of the most important things employers can do to prevent wage theft is to keep accurate and detailed payroll records. This includes tracking employees' hours worked, pay rates, deductions, and any overtime or bonus payments. Employers should also provide employees with itemized wage statements (pay stubs) each pay period, as required by California law. These statements should include the employee's gross wages, total hours worked, deductions, and net pay. Maintaining organized and transparent payroll records not only helps prevent wage theft but also provides important documentation.

Providing Timely Access to Personnel Files

California law requires employers to provide employees with access to their personnel files and payroll records upon request. Employers must provide this access within a reasonable timeframe, typically within 30 days of the request. Providing timely access to personnel files helps promote transparency and allows employees to verify that their wages and benefits are being properly calculated and paid. It also demonstrates a commitment to compliance and can help build trust between employers and employees.

Communicating Effectively with Employees about Wage and Hour Laws

Finally, employers should prioritize clear and effective communication with employees about their rights under California wage and hour laws. This includes providing information on minimum wage, overtime, meal and rest breaks, and the process for reporting any concerns or violations. Employers can communicate this information through employee handbooks, posters in the workplace, and regular training sessions. They should also create a culture where employees feel comfortable raising questions or concerns about their pay without fear of retaliation. By taking these proactive steps and staying up-to-date on California labor laws, employers can help prevent wage theft and create a fair and compliant workplace for all employees.

 
Key Takeaway:

Wage theft in California affects many workers each year. It includes underpaying wages, not paying overtime, and denying breaks. If you're a victim, don't hesitate to reach out and receive help recovering unpaid wages.

Conclusion

If there's one thing I've learned through years of advocating for fair treatment at work; understanding your rights changes everything. So stay informed on issues like wage theft in California because knowledge truly is power.

Those who need help from experienced wage theft attorneys can contact our law firm to receive a free consultation. Give us a call, engage with our chat, or fill out our form to receive help today.

About the Author

Eric Kingsley

Eric B. Kingsley is a 2023 "Best In Law" Award winner and has litigated over 150 class actions. He is also an AV peer rated attorney and a prolific speaker at various seminars on employment law.

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