Employees in California must be paid for their work, and their employers are mandated to pay their employees on time. Unfortunately, some employers fail to pay their workers on time or at all, which can cause financial problems for the workers. Workers who are not paid on time or who are not paid for their work have a right to recover any back pay that they are owed. They can also recover penalties that are assessed against their employers under either the Private Attorneys General Act or under Cal. Lab. Code 210. Because of an amendment to Cal. Lab. Code 210 that was effective on Jan. 1, 2020, workers who are paid late or who are not paid might recover more damages by pursuing penalties under that statute instead of under a PAGA claim.
Payment of Wages in CaliforniaIn California, employers are required to pay their workers the compensation amounts that the employers have promised to pay. This includes an employee's hourly wage for all hours worked or his or her regular salary, bonuses, commissions, and all other types of compensation that have been promised. Employers are also mandated to pay their employees on time. The timing of wage payments will depend on whether the employer pays the employees on a weekly, biweekly, semi-monthly, or monthly basis.
In general, employers must have regular and consistent pay dates. Workers who are paid weekly, bi-weekly, or semi-monthly must be paid for all of the hours they worked before the close of the pay period within seven days of when the pay period ends. Overtime pay that is owed from the pay period must also be paid on the next regular pay date. Executives and exempt professionals who are paid a salary may be paid on a monthly basis, but they must be paid on or by the 26th of the month. Workers who work for temporary services must be paid each week at the end of the week.
When an employee is terminated from his or her job, he or she must be paid all of his or her wages and accrued vacation pay immediately. The payment must be paid to the worker at the place where he or she is fired. Employees who quit their jobs must be paid within 72 hours of when they leave their jobs, including their wages, accrued vacation pay, and other types of accumulated compensation.
If there is a dispute over the amount of pay that is owed, the employer must still pay the employee all of the amounts of the payment that it agrees it owes. It cannot wait to pay an employee the amounts that are not in dispute until the dispute is resolved.
When an employer pays an employee late, the employee can file a claim against the employer under either Cal. Lab. Code 210 or the Private Attorneys General Act. Since 210 was recently amended to allow employees to file private causes of action, it might make more sense to file a claim under this statute than under the PAGA.
Section 210 ActionsCalifornia AB 673 was passed by the California Legislature and signed into law by Gov. Newsom on Oct. 10, 2019.[1] This law amended Cal. Lab. Code 210 to allow workers to pursue private legal actions against employers to recover penalties for the late payment of wages. Previously, this statute only allowed the California Labor Commission to pursue penalties against employers for paying wages late. The statute now reads as follows:
210. "...Every person who fails to pay the wages of each employee as provided in Sections 201.3, 204, 204b, 204.1, 204.2, 204.11, 205, 205.5, and 1197.5, shall be subject to a penalty as follows:
(1) For any initial violation, one hundred dollars ($100) for each failure to pay each employee.
(2) For each subsequent violation, or any willful or intentional violation, two hundred dollars ($200) for each failure to pay each employee, plus 25 percent of the amount unlawfully withheld.
(b) The penalty shall either be recovered by the employee as a statutory penalty pursuant to Section 98 or by the Labor Commissioner as a civil penalty through the issuance of a citation or pursuant to Section 98.3. The procedures for issuing, contesting, and enforcing judgments for citations issued by the Labor Commissioner under this section shall be the same as those set forth in subdivisions (b) through (k), inclusive, of Section 1197.1.
(c) An employee is only entitled to either recover the statutory penalty provided for in this section or to enforce a civil penalty as set forth in subdivision (a) of Section 2699, but not both, for the same violation."
Under subsection (1) of the statute, an employee can recover $100 for the first late payment violation by an employer. Under subsection (2), if the employer pays the employee late a second time or willfully or intentionally pays the employee late the first time, the penalty that can be recovered is $200 together with 25% of the amount that the employer paid late.
For example, if a worker earns a paycheck of $1,000 and is paid late, the employee would be entitled to recover $100 for the penalty that he or she is owed. If the employer fails to pay the employee on time for two pay periods, the employee would be entitled to recover $100 for the first violation, $200 for the second violation, and 25% of $1,000 or $250 for the second violation. This would entitle the employee to recover $550 in penalties for the late payments.
Under subsection (2)(b), the statute specifies that either the employee or the Labor Commission can recover the penalty. If the employee files a 210 claim, the penalty will be paid to the employee. If the Labor Commission files a citation against the employer, the penalty will be paid to the Labor Commission.
In subsection (2)(c), the law states that an employee may recover penalties from a late-paying employer either under 210 or under Cal. Lab. Code 2699(a) but not under both for the same violation of the wage and hour law. Section 2699(a) is a part of the Private Attorneys General Act, which is codified at Cal. Lab. Code 2698 - 2699.5.
PAGA ActionsUnder the Private Attorneys General Act, the penalty for a first violation is $100. The penalty for a second violation is $200 plus 25% of the amount that was paid late. However, these penalties are normally paid to the state. PAGA only allows employees to recover 25% of the penalties with the remainder going to the state. PAGA claims also allow employees to recover their reasonable costs and attorney's fees.
When comparing actions under 210 and under PAGA, it is clear that an employee might recover more money by filing a claim under 210. This is because the employee is entitled to recover the entire penalty amount under 210 instead of only recovering 25% under PAGA. If a worker files an action under 210, he or she will not be able to also file an action against his or her employer under PAGA for the same violation.
Get Help From the Law Firm of Steven M. Sweat APCIf your employer has consistently paid you late or has failed to pay you all of the amounts that you were promised, you may be entitled to recover compensation. Getting help from an experienced employment law attorney at the law firm of Steven M. Sweat APC might allow you to recover maximal compensation and to prevent your employer from continuing to pay you and its other employees late in the future. Contact us today to schedule a consultation by calling us at 866.966.5240.