BILL ANALYSIS Ó
AB 1386
Page 1
Date of Hearing: May 8, 2013
ASSEMBLY COMMITTEE ON APPROPRIATIONS
Mike Gatto, Chair
AB 1386 (Labor and Employment Committee) - As Introduced:
March 4, 2013
Policy Committee: Education
Vote:7-0
Urgency: No State Mandated Local Program:
Yes Reimbursable: Yes
SUMMARY
This bill authorizes the Labor Commissioner (LC) to file, within
10 days of a wage claim order becoming final, a certified copy
of the final order with the county recorder of any county in
which the employer's property may be located. Specifically,
this bill:
1)Authorizes the order to be filed in any and all counties of
the state at the LC's discretion and depending upon
information the LC obtains concerning the employer's assets.
2)Requires the amount of the claim found due to be a lien in
favor of the employee named in the order and against the
personal and real property of the employer named in the order
within the county in which the order is filed.
3)Requires the county recorder to record the order as a mortgage
on real estate and file the same as security interest, as
specified. Further requires the recorder to include all
charges for his or her services in the amount due under the
lien.
FISCAL EFFECT
Potential for minor GF savings to the Department of Industrial
Relations to streamline the process of collecting unpaid wages.
COMMENTS
AB 1386
Page 2
1)Background . Under existing law, the LC is authorized to hear
employee complaints regarding wages and other provisions. If
the LC issues an order, decision, or award (ODA) against the
employer, the employer has 10 days to appeal this decision to
the superior court. If the employer does not appeal, the ODA
is final and the LC is required to file it with the superior
court of the appropriate county, as specified.
When the LC files the ODA with the superior court, the ODA
becomes a judgment against the employer. This judgment is a
legal determination of rights, but it does not establish an
obligation to pay. Instead, the LC must file the judgment
with the county recorder in order for the employee to receive
payment, as specified.
2) Purpose . According to the author, "In order to record
the judgment debt, the employee first needs to obtain an
Abstract of Judgment from the court. This process may take
several weeks; during that time the employer may have
liquidated its business, or otherwise divested itself of
tangible and real property, thereby denying the employee
the opportunity to collect the wages found due and owing by
the LC. The current procedure requires the ODA of the LC
to be converted into a superior court judgment before it
can be recorded as a property lien against an employer's
property. If the employer has not appealed the ODA within
the time permitted, the employee must wait until the clerk
of the superior court has entered the ODA into the court's
judgment book or rolls. This action by the court clerk may
take several weeks, and given the effect of budget cuts on
the courts, will most likely take longer in the future."
Analysis Prepared by : Kimberly Rodriguez / APPR. / (916)
319-2081