Avoiding Wage and Hour Litigation L a ura A. Wo lfe 559-433-1300 - - PowerPoint PPT Presentation

Avoiding Wage and Hour Litigation

L a ura A. Wo lfe 559-433-1300

Wage and Hour Lawsuits Have Increased by More than 400%

Mo st c o mmo n a lle g a tio ns a re :

• F

a ilure to pa y o ve rtime / do ub le time

• F

a ilure to pa y pre - a nd po st-shift “o ff the c lo c k” a c tivitie s

• F

a ilure to pro vide me a l a nd re st b re a ks

• Misc la ssific a tio n o f e mplo ye e s a s “e xe mpt” o r

inde pe nde nt c o ntra c to rs

• F

a ilure to re imb urse fo r b usine ss-re la te d e xpe nse s

Primary Sources of Wage and Hour Law

• F

e de ra l F a ir L a b o r Sta nda rds Ac t

• Co de o f F

e de ra l Re g ula tio ns

• Ca lifo rnia L

a b o r Co de

• I

ndustria l We lfa re Co mmissio n Wa g e Orde rs

E MPL OYE RS MUST F OL L OW L AW T HAT IS MOST F AVORABL E T O E MPL OYE E S

Fair Labor Standards Act (FLSA)

• Applie s to e mplo ye e s o f e nte rprise s e ng a g e d in

c o mme rc e o r in the pro duc e o f g o o ds fo r c o mme rc e

• Bro a d de finitio n
• Applie s to mo st a ll e mplo ye rs in Ca lifo rnia

FLSA Regulates

• F

e de ra l minimum wa g e

• Ove rtime a fte r 40 ho urs in a wo rkwe e k
• E

mplo yme nt o f mino rs

• Re c o rdke e ping
• Bo na fide b re a ks

California Labor Code

• Applie s to a ll e mplo ye rs in Ca lifo rnia
• Minimum wa g e ($10 o r $10.50 if o ve r 25 e mplo ye e s)
• Ove rtime a fte r 8 ho urs in a wo rkda y o r 40 in a

wo rkwe e k unle ss Wa g e Orde r 14

• Do ub le time a fte r 12 ho urs in a wo rkda y
• Re c o rd ke e ping , wa g e sta te me nts, va c a tio n, pa id

sic k le a ve

Allegation 1: Failure to Pay Overtime

Overtime

• 1 ½ time s re g ula r ra te o f pa y fo r a ll ho urs wo rke d

b e yo nd 8 in a wo rkda y*

• 1 ½ time s re g ula r ra te o f pa y fo r a ll ho urs wo rke d

b e yo nd 40 in a wo rkwe e k*

• 2 time s re g ula r ra te o f pa y fo r a ll ho urs wo rke d in

e xc e ss o f 12 in a wo rkda y*

• 1 ½ time s re g ula r ra te o f pa y fo r first 8 ho urs o n the

se ve nth c o nse c utive da y o f wo rk in a sing le wo rkwe e k

• 2 time s the re g ula r ra te o f pa y fo r a ll ho urs b e yo nd 8
• n the se ve nth da y

*E xc e pt Wa g e Orde r 14 (Ag . wo rke rs – b ut no te c ha ng e b e g inning in 2019)

Overtime

• Ca lifo rnia la w re q uire s tha t yo u pa y e mplo ye e s fo r
• ve rtime whe the r a utho rize d o r no t.
• Po lic ie s whe re o ve rtime is no t a llo we d unle ss “pre -

a utho rize d b y e mplo ye r” do no t me a n yo u do no t ha ve to pa y o ve rtime – if the e mplo ye e is “suffe re d

• r pe rmitte d” to wo rk, the n yo u must pa y.
• Yo u c a n disc ipline a ny e mplo ye e who do e s no t

fo llo w yo u po lic y o f pre -a utho riza tio n.

Seven Day Rules

• L

a b o r Co de se c . 552: “No e mplo ye r o f la b o r sha ll c a use his e mplo ye e s to wo rk mo re tha n six da ys in se ve n.”

• T

his do e s no t pre ve nt a n a c c umula tio n o f da ys o f re st “whe n the na ture o f the e mplo yme nt re a so na b ly re q uire s tha t the e mplo ye e wo rk se ve n

• r mo re c o nse c utive da ys”, if in e a c h c a le nda r

mo nth the e mplo ye e re c e ive s da ys o f re st e q uiva le nt to o ne da y's re st in se ve n.

Seven Day Rules (cont’d)

• T

he L a b o r Co de ’ s Se ve n-Da y rule is no t limite d to a “wo rkwe e k”

• Wa g e Orde rs re q uire se ve nth da y o ve rtime o nly fo r

ho urs wo rke d “o n the se ve nth c o nse c utive da y o f wo rk in a wo rkwe e k”

Workweek

• Any se ve n c o nse c utive 24 ho ur pe rio ds sta rting o n

the sa me c a le nda r da y e a c h we e k

• I

f no t de fine d b y the e mplo ye r, wo rkwe e k runs fro m Sunda y thro ug h Sa turda y

• Po ssib le to wo rk se ve n o r mo re da ys stra ig ht

de pe nding o n ho w the da ys wo rke d fa ll within a de fine d wo rkwe e k

• E

xa mple : Wo rkwe e k runs Sunda y-Sa turda y. E

mplo ye e c a n wo rk Mo nda y, T ue sda y, We dne sda y, T hursda y, F rida y, Sa turda y in we e k 1 AND Sunda y, Mo nda y, T ue sda y, We dne sda y, T hursda y a nd F rida y in we e k 2 witho ut a c c ruing se ve nth da y o ve rtime

Workweek

• Me ndo za v. No rdstro m, I

nc . – Ma y 2017

• Ca lifo rnia Supre me Co urt a nswe re d the q ue stio n

a b o ut the diffe re nc e b e twe e n wa g e o rde r wo rkwe e ks a nd da y o f re st re q uire me nt unde r L a b o r Co de .

• “A da y o f re st is g ua ra nte e d fo r e a c h wo rkwe e k.

Pe rio ds o f mo re tha n six c o nse c utive da ys o f wo rk tha t stre tc h a c ro ss mo re tha n o ne wo rkwe e k a re no t pe r se pro hib ite d.”

Workweek

• Me ndo za v. No rdstro m, I

nc . – Ma y 2017

• CA Supre me Co urt a lso de c ide d the issue re la ting to the

six-ho ur rule unde r L C 556 (Se c tio ns 551 a nd 552 (7th da y re st rule s) sha ll no t a pply to a ny e mplo ye r o r e mplo ye e whe n the to ta l ho urs o f e mplo yme nt do no t e xc e e d 30 ho urs in a ny we e k o r six ho urs in a ny o ne da y the re o f.)

• Q: Whic h is a n a c c ura te re a ding ? 1) So lo ng a s a n

e mplo ye e is g ive n a t le a st o ne da y o f no mo re tha n 6 ho urs during a o ne -we e k pe rio d, he ma y b e re q uire d to wo rk a ll 7 da ys witho ut a da y o f re st; o r 2) e limina tio n o f the 7th da y o f re st o nly a pplie s to e mplo ye e s who wo rk no mo re tha n 6 ho urs e a c h a nd e ve ry da y o f the we e k.

• SC He ld:”[W]e c o nc lude the ‘ six ho urs o r le ss’ da ily

e xc e ptio n is sa tisfie d o nly if e ve ry da ily shift tha t we e k ha s e nta ile d six ho urs o r le ss o f wo rk.”

Workday

• A c o nse c utive 24 ho ur pe rio d sta rting a t the sa me

time e a c h c a le nda r da y;

• Ca n b e de fine d b y e mplo ye r;
• Ca n ha ve diffe re nt wo rkda ys fo r diffe re nt po sitio ns;
• I

f no t de fine d b y e mplo ye r, wo rkda y runs fro m 12:01 a .m. to midnig ht

Regular Rate of Pay

• Ho urly ra te pa id fo r e mplo ye e ’ s wo rk inc luding a g re e d

ra te (b a se pa y) plus a ll o the r fo rms o f c o mpe nsa tio n

• Inc lude s c o mmissio ns, no ndisc re tio na ry b o nuse s, pie c e wo rk

e a rning s.

• E

xa mple : e mplo ye e e a rns $10/ ho ur plus $1 fo r e ve ry widg e t ma de . E mplo ye e wo rke d 60 ho urs a nd ma de 200 widg e ts in a wo rkwe e k. F

• r purpo se s o f c a lc ula ting
• ve rtime :

(60h x $10) + $200 = $800. $800/ 60 ho urs = Re g ula r ra te o f $13.33 a n ho ur. Pre mium pa y fo r o ve rtime : $13.33 x .5 x 20 = $133.33 T

• ta l we e kly c o mpe nsa tio n: $800 + $133.33 =$933.33.
• Doe s not inc lude g ifts; ho urs pa id b ut no t wo rke d (va c a tio n,

sic k, ho lida y, e tc .); e xpe nse re imb urse me nts; disc re tio na ry b o nuse s; E RI SA pla n pa yme nts; o ve rtime pa y

Off‐the‐Clock Work

E mplo ye e s must b e c o mpe nsa te d fo r a ll c lo se ly re la te d dutie s a nd ta sks, e ve n if tho se a c tivitie s a re pe rfo rme d o utside o f re g ula rly sc he dule d ho urs.

• Pho ne c a lls, te xt me ssa g e s, e -ma ils o utside o f wo rk
• Ma king wo rk-re la te d sto ps o n the wa y to o r fro m

wo rk

• Pe rfo rming a ny wo rk during me a l pe rio ds o r re st

b re a ks

• “Do nning a nd Do ffing ”

Travel Time

• Ordina ry tra ve l time b e twe e n ho me a nd wo rk do e s

no t ne e d to b e c o mpe nsa te d. Ho we ve r, ho me to wo rk tra ve l is c o mpe nsa b le in a n e me rg e nc y tra ve l situa tio n during no n-re g ula r ho urs to a c usto me r’ s pla c e o f b usine ss.

• T

ra ve l during the wo rkda y tha t is pa rt o f the e mplo ye e ’ s princ ipa l a c tivity is c o nside re d ho urs wo rke d a nd must b e c o mpe nsa te d.

On Call Time

T he re is a distinc tio n b e twe e n time spe nt “o n-c a ll” b ut no t a c tua lly pe rfo rming wo rk a nd the time spe nt wo rking a s a re sult o f b e ing o n-c a ll. Unde r b o th sta te a nd fe de ra l la w, a no n-e xe mpt e mplo ye e must b e c o mpe nsa te d fo r the time spe nt wo rking , b ut whe the r c o mpe nsa tio n is re q uire d fo r simply b e ing “o n-c a ll” de pe nds o n the fa c ts o f e a c h c a se a nd in Ca lifo rnia it will de pe nd o n “c o ntro l”.

Allegation 2: Failure to Provide Meal Periods or Rest Breaks

Meal Periods and Rest Breaks

• Almo st a lwa ys inc lude d with a lle g a tio ns o f o the r

wa g e a nd ho ur vio la tio ns

• Pe na lty fo r vio la tio n is pa yme nt o f o ne ho ur’ s wa g e

(me a l pe rio d/ re st pe rio d “pre mium”)

• Me a l pe rio d a nd re st b re a ks a re se pa ra te vio la tio ns
• I

f e mplo ye e s misse s mo re tha n o ne re st pe rio d, the re is o nly

• ne pe na lty pe r da y; a ssumptio n is me a l pe rio d vio la tio ns

a re the sa me b ut this ha s no t ye t b e e n e xpre ssly c o difie d

• r rule d o n b y the c o urts.
• T

hus, a n e mplo ye r c a n b e lia b le fo r up to 2 ho urs o f the e mplo ye e ’ s re g ula r ra te o f pa y, pe r da y, fo r misse d me a l a nd re st pe rio ds.

Rest Breaks

• No n-e xe mpt e mplo ye e s a re e ntitle d to 10 minute s
• f ne t re st fo r e a c h fo ur ho urs wo rke d, o r ma jo r

fra c tio n the re o f (i.e ., 2 ho urs)

• Re st pe rio d sho uld b e a s c lo se to the middle o f

e a c h fo ur ho ur pe rio d a s re a so na b ly pra c tic a b le

• Re st pe rio ds a re pa id- e mplo ye e s must no t c lo c k in

a nd o ut

• E

ve n tho ug h re st pe rio ds a re “o n-duty” the e mplo ye e c a nno t b e sub je c t to the e mplo ye r’ s c o ntro l

Meal Period

• No n-e xe mpt e mplo ye e s who wo rk a shift o f mo re

tha n 5 ho urs a re e ntitle d to a t le a st 30 minute s fo r the me a l pe rio d a nd a re e ntitle d to a dditio na l 30 minute s fo r e ve ry five ho urs o f wo rk

• Me a l pe rio d must c o mme nc e b e fo re the e nd of the

fifth hour

• E

mplo ye e is sc he dule d fro m 8 a .m. to 5 p.m. Me a l pe rio d must b e g in b y 12:59 p.m.

• Me a l Pe rio ds a re o ff-duty, no t pa id, a nd e mplo ye e s

must c lo c k in a nd o ut

Meal Periods

• E

mplo ye e ma y wa ive the me a l pe rio d if 6 ho urs will c o mple te the da ys’ wo rk – no re q uire me nt tha t the wa ive r b e in writing b ut it’ s a g o o d ide a

• An e mplo ye e who wo rks 10 o r mo re ho urs is e ntitle d

to a se c o nd me a l pe rio d tha t must b e ta ke n b e fo re c o mple tio n o f the 10th ho ur

• Se c o nd me a l pe rio d c a n b e wa ive d if
• E

mplo ye e did no t wa ive the first me a l pe rio d

• E

mplo ye e wo rks 12 ho urs o r le ss

• Ag a in, no t re q uire d to b e in writing b ut a g o o d ide a

Wage Statement Requirements

• L

a b o r Co de 226 re q uire s tha t e mplo ye rs inc lude the fo llo wing ite ms o n a n e mplo ye e ’ s wa g e sta te me nt:

• g ro ss wa g e s e a rne d
• to ta l ho urs wo rke d b y the e mplo ye e
• the numb e r o f pie c e -ra te units e a rne d a nd a ny a pplic a b le pie c e ra te if the

e mplo ye e is pa id o n a pie c e -ra te b a sis

• a ll de duc tio ns, pro vide d tha t a ll de duc tio ns ma de o n writte n o rde rs o f the

e mplo ye e ma y b e a g g re g a te d a nd sho wn a s o ne ite m

• ne t wa g e s e a rne d
• the inc lusive da te s o f the pe rio d fo r whic h the e mplo ye e is pa id
• the na me o f the e mplo ye e a nd o nly the la st fo ur dig its o f his o r he r so c ia l

se c urity numb e r o r a n e mplo ye e ide ntific a tio n numb e r o the r tha n a so c ia l se c urity numb e r

• the na me a nd a ddre ss o f the le g a l e ntity tha t is the e mplo ye r a nd, if the

e mplo ye r is a fa rm la b o r c o ntra c to r, the na me a nd a ddre ss o f the le g a l e ntity tha t se c ure d the se rvic e s o f the e mplo ye r

• a ll a pplic a b le ho urly ra te s in e ffe c t during the pa y pe rio d a nd the

c o rre spo nding numb e r o f ho urs wo rke d a t e a c h ho urly ra te b y the e mplo ye e a nd, if the e mplo ye r is a te mpo ra ry se rvic e s e mplo ye r, the ra te o f pa y a nd the to ta l ho urs wo rke d fo r e a c h te mpo ra ry se rvic e s a ssig nme nt

Wage Statement Requirements

Additio na l ite ms to inc lude :

• Me a l pe rio d a nd re st pe rio d pre mium pa y
• Pa id Sic k L

e a ve

• Pa id va c a tio n
• Anything pa id fro m a prio r pa y pe rio d must

ide ntify in whic h pa y pe rio d it wa s e a rne d.

Allegation 3: Misclassification

Exempt vs. Non‐Exempt

• “E

xe mpt” fro m wha t?

• Ove rtime
• Me a l Pe rio ds
• Re st Bre a ks
• Wa g e sta te me nt re q uire me nts o f L

a b o r Co de se c tio n 226(a )

Exemptions

• “White c o lla r” e xe mptio ns: E

xe c utive , Administra tive , Pro fe ssio na l

• Outside sa le s
• Hig hly Co mpe nsa te d E

mplo ye e s (F e de ra l o nly)

• I

nside sa le s

• Co mpute r so ftwa re e ng ine e rs (tre a te d like

pro fe ssio na l e xe mptio n b ut pa id ho urly)

White Collar Exemptions

T hre e te sts de te rmine e xe mpt sta tus fo r “white c o lla r” e xe mptio ns: 1) Sa la ry T e st 2) Sa la rie d Ba sis 3) Dutie s T e st

Salary Test

E xe mpt e mplo ye e s must ma ke two time s the minimum wa g e , c urre ntly $43,680

Salary Basis Test

• Pa id pre de te rmine d c o mpe nsa tio n we e kly

(“sa la ry”)

• Sa la ry c a nno t b e re duc e d:
• b e c a use o f va ria tio ns in q ua lity o r q ua ntity o f wo rk
• F
• r a b se nc e s re q uire d b y the e mplo ye r
• Be c a use no wo rk is a va ila b le

Salary Basis Test

• But, yo u c a n ma ke de duc tio ns fo r:
• Ab se nc e o f o ne o r mo re full da ys fo r pe rso na l re a so ns (no t

illne ss o r disa b ility) whe re no va c a tio n time a va ila b le to c o ve r the a b se nc e

• Ca n de duc t fro m a c c rue d va c a tio n b a nk fo r pa rtia l da ys’

a b se nc e , b ut yo u c a nno t de duc t wa g e s fo r pa rtia l da y a b se nc e s o nc e va c a tio n le a ve is e xha uste d (o r no t pro vide d)

• Ab se nc e o f o ne o r mo re full da y whe n e mplo ye e is a b se nt

fo r illne ss o r disa b ility a nd de duc tio n is ma de pursua nt to a b o na fide sic k le a ve po lic y

Duties Test

• F

L SA use s “prima ry duty” te st, so c o nc urre nt pe rfo rma nc e o f e xe mpt a nd no n-e xe mpt do e s no t disq ua lify e mplo ye e fro m e xe mpt sta tus

• BUT

, Ca lifo rnia re q uire s mo re tha n 50% o f a n e mplo ye e ’ s time to b e spe nt pe rfo rming e xe mpt wo rk

Executive

• Dutie s a nd re spo nsib ilitie s invo lve the manage me nt
• f the b usine ss o r o f a c usto marily re c o gnize d

de partme nt o r subdivisio n o f the b usine ss; a nd

• Custo ma rily a nd re g ula rly dire c ts two o r mo re full-

time e mplo ye e s (o r pa rt-time e q uiva le nts); a nd

• Ca n hire , fire o r re c o mme nda tio ns to do so a re

g ive n pa rtic ula r we ig ht; a nd

• Custo ma rily a nd re g ula rly e xe rc ise s disc re tio n and

inde pe nde nt judgme nt

Administrative

• Offic e o r no n-ma nua l wo rk dire c tly re la te d to

ma na g e me nt po lic ie s o r g e ne ra l b usine ss o pe ra tio ns o f the e mplo ye r o r the e mplo ye r’ s c usto me rs; a nd

• Custo ma rily a nd re g ula rly e xe rc ise s disc re tio n a nd

inde pe nde nt judg me nt; a nd

• Re g ula rly a nd dire c tly a ssists a pro prie to r, o r a n

e mplo ye e in a b o na fide e xe c utive o r a dministra tive c a pa c ity; or

• Who pe rfo rms unde r o nly g e ne ra l supe rvisio n wo rk a lo ng

spe c ia lize d o r te c hnic a l line s re q uiring spe c ia lize d tra ining , e xpe rie nc e o r kno wle dg e ; or

• Who e xe c ute s unde r o nly g e ne ra l supe rvisio n spe c ia l

a ssig nme nts a nd ta sks

Examples of Administrative

• E

xe c utive o r a dministra tive a ssista nt to a b usine ss

• wne r o r e xe c utive if suc h e mplo ye e ha s b e e n

de le g a te d a utho rity re g a rding ma tte rs o f sig nific a nc e (i.e ., no t just da ta e ntry, tra nsc rib ing dic ta tio n, e tc .);

• Huma n re so urc e s ma na g e rs who fo rmula te ,

inte rpre t o r imple me nt e mplo yme nt po lic ie s;

• Purc ha sing a g e nts with a utho rity to b ind the

c o mpa ny o n sig nific a nt purc ha se s

Professional

• L

ic e nse d o r c e rtifie d b y the sta te a nd prima rily e ng a g e d in the pra c tic e o f la w, me dic ine , de ntistry,

• pto me try, a rc hite c ture , e ng ine e ring , te a c hing o r

a c c o unting ; or

• Prima rily e ng a g e d in a n o c c upa tio n c o mmo nly

re c o g nize d a s a le a rne d o r a rtistic pro fe ssio n (kno wle dg e o f a n a dva nc e d type in sc ie nc e o r le a rning c usto ma rily a c q uire d b y a pro lo ng e d c o urse o f spe c ia lize d instruc tio n a nd study); a nd

• Custo ma rily a nd re g ula rly e xe rc ise s disc re tio n a nd

inde pe nde nt judg me nt

Outside Sales Exemption

• Outside sa le s
• E

mplo ye e s o ve r 18 who spe nd mo re tha n ½ o f wo rking time a wa y fro m e mplo ye r’ s pla c e o f b usine ss “se lling ” o r

• b ta ining o rde rs o r c o ntra c ts fo r pro duc ts, se rvic e s o r use
• f fa c ilitie s. No minimum salary re quire me nt.

Inside Sales Exemption

• I

nside Sa le s

• E

mplo ye e s c o ve re d b y Wa g e Orde rs 4 (pro fe ssio na l) o r 7 (re ta il)

• E

a rning s must e xc e e d 1 ½ time s the minimum wa g e fo r a ll ho urs wo rke d

• Mo re tha n ha lf o f the e mplo ye e ’ s c o mpe nsa tio n must

re pre se nt c o mmissio ns

• E

mplo ye rs must still ke e p time re c o rds

Inside Sales (cont’d)

• Ca nno t a ttrib ute c o mmissio n wa g e s pa id in o ne

pa y pe rio d to o the r pa y pe rio ds in o rde r to me e t the wa g e re q uire me nts

• Pe abo dy v. T

ime Warne r

• Pla intiff wa s pa id b iwe e kly, fixe d ho urly wa g e s a t

$9.61/ ho ur b a se d o n a 40 ho ur wo rkwe e k (min. wa g e wa s $9).

• Onc e a mo nth she wa s pa id c o mmissio ns.
• I

n the 10 mo nths she wo rke d fo r T W, she wa s pa id $75,000 in wa g e s.

• Pe a b o dy sue d T

W sa ying she wo rke d 45 ho urs/ we e k a nd wa s ne ve r pa id o ve rtime .

• T

W a rg ue d Pe a b o dy fe ll unde r the “inside sa le s” e xe mptio n.

• Altho ug h she wa s pa id $75,000 to ta l, he r pa yc he c ks

inc lude d o nly ho urly wa g e s a nd e q ua te d to le ss tha n 1.5 time s the minimum wa g e .

• T

W a rg ue d c o mmissio ns sho uld b e a ttrib ute d no t to the pa y pe rio d in whic h the y we re pa id b ut the we e ks in the mo nth whe n c o mmissio ns we re e a rne d.

• Co urt re je c te d the a rg ume nt; the minimum wa g e s

pro ng is b a se d o n the wa g e s a c tua lly pa id in the pa y pe rio d.

• Whe the r 50% o f e a rning s c o me s fro m c o mmissio ns is

no t e a c h pa y pe rio d b ut a re pre se nta tive pe rio d, e .g ., q ua rte rly o r e ve ry 6 mo nths.

• T
• a vo id lia b ility, pa y 1.5 time s ho urly ra te fo r a ll

ho urs wo rke d e xc lusive o f c o mmissio ns;

• Or c o mmissio n pla n sho uld sta te tha t c o mmissio ns

a re e a rne d a nd pa id e a c h pa y pe rio d b ut this will re q uire c lo se mo nito ring o f e mplo ye e ’ s to ta l e a rning s e a c h wo rk we e k.

Correcting Isolated, Inadvertent and Impermissible Deductions

• E

mplo ye r will lo se e xe mptio n fo r ma king impro pe r de duc tio ns if a nd o nly if the e mplo ye r ha s a n a c tua l pra c tic e o f impro pe r de duc tio ns

• No “a c tua l pra c tic e ” if:
• E

mplo ye r ha s a c le a rly c o mmunic a te d po lic y tha t pro hib its impro pe r de duc tio ns

• Re imb urse s e mplo ye e s fo r impro pe r de duc tio ns a nd
• Ma ke s a g o o d fa ith c o mmitme nt to c o mply in the future

Penalties for Misclassification

• Pa yme nt o f unpa id o ve rtime / do ub le time
• L

iq uida te d da ma g e s unde r F L SA

• I

na c c ura te wa g e sta te me nts

• Me a l a nd re st b re a k pe na ltie s
• Wa iting time pe na ltie s if e mplo ye e is no lo ng e r

e mplo ye d

Allegation 4: Failure to Reimburse for Necessary Work‐Related Expenses

Reimbursement

• L

a b o r Co de se c tio n 2802 re q uire s a n e mplo ye r to inde mnify its e mplo ye e s fo r a ll e xpe nse s a nd lo sse s ne c e ssa rily inc urre d in the disc ha rg e o f the ir dutie s.

• A c o mpo ne nt o f the “ne c e ssa ry” re q uire me nts is

tha t e xpe nse s must b e “re a so na b le ”

• Mile a g e , to o ls/ e q uipme nt, pe rso na l de vic e s,

unifo rms

Penalties

Wa iting T ime Pe na ltie s (L

a b o r Co de 203: pro vide s tha t if a ny wa g e s a re due a nd no t pa id whe n a n e mplo ye e q uits o r is disc ha rg e d, the e mplo ye r will b e sub je c t to pe na ltie s. Me a sure d b y the e mplo ye e ’ s da ily ra te o f pa y, up to 30 (c a le nda r) da ys. De fe nse if the re is a g o o d fa ith dispute b a se d o n la w

• r fa c ts tha t no wa g e s a re o we d.

Penalties

• PAGA (Priva te Atto rne y Ge ne ra l Ac t)
• Asse sse s pe na ltie s fo r L

a b o r Co de vio la tio ns

• 75% o f re c o ve ry g o e s to the Sta te ; 25% to

“a g g rie ve d e mplo ye e s”

• L

e ss string e nt re q uire me nts tha n a c la ss a c tio n

• Pe na ltie s a re pe rmitte d to “sta c k”
• Co urt ha s disc re tio n to re duc e pe na lty if

c o nfisc a to ry, o ppre ssive , o r o the rwise unjust

Penalties

• L

a bor Code 226 Pe na ltie s (Wa g e Sta te me nt

Vio la tio ns)

• I

f e mplo ye e de e me d to ha ve suffe re d a n injury due to inc o rre c t wa g e sta te me nts, pe na lty is $250 pe r e mplo ye e pe r vio la tio n in a n initia l c ita tio n, $1,000 pe r e mplo ye e fo r e a c h vio la tio n in a sub se q ue nt c ita tio n (no t to e xc e e d $4,000)

• “I

njury” is a lo w sta nda rd.

• Pro b le m – whe n yo u ha ve inc o rre c t OT

/ DT c a lc ula tio ns o r misse d me a l pe rio ds, yo u ha ve ina c c ura te wa g e sta te me nts, trig g e ring a vio la tio n

• f 226.

Questions?

Thank you!