New Employment Laws For 2012: Increased Potential Liability For Minimum Wage Violations

Governor Jerry Brown approved Assembly Bill 240 (AB 240) on September 7, 2011, and the new employment law originally introduced by Assembly member Susan Bonilla amends section 98 of the Labor Code to permit the Labor Commissioner to award employees liquidated damages in an administrative complaint for failure to pay minimum wage. The bill ensures that workers receive the same relief for minimum wage violations, regardless of whether they pursue their claims administratively or through the courts. In other words, the amount of liquidated damages is equal to the amount of unpaid wages, meaning that a successful employee would recover double the wages owed.

Before AB 240, workers in California could either file a civil action to recover unpaid wages or file an administrative complaint with the Labor Commissioner. However, liquidated damages were only available if the case was brought in court, as only the Labor Commissioner had the authority to recover wages, penalties and other demands for compensation.

How big of a problem was this? According to Bonilla’s website, a 2010 report from the University of California, Los Angeles (UCLA) found that 29.7 percent of workers were paid below the state minimum wage, a 2009 report from the Ford Foundation found that “depending on the industry or occupation,” 40 to 66 percent of workers were not paid the minimum wage and the 2009 book “Wage Theft in America” stated that “possibly as many as 3 million workers not being paid the minimum wage.”

What do you think of this new law? Have you ever been involved in a wage dispute?

Law Offices of Kesluk, Silverstein & Jacob – Los Angeles employment lawyers