Amended in Assembly March 15, 2016

California Legislature—2015–16 Regular Session

Assembly Bill No. 2535

Introduced by Assembly Member Ridley-Thomas

February 19, 2016

An act to amend Section 226 of the Labor Code, relating to wages.

LEGISLATIVE COUNSEL’S DIGEST

AB 2535, as amended, Ridley-Thomas. Employment: wages: itemized statements.

Existing law requires an employer to provide his or her employee an begin insert accurate end insert itemized statement begin insert in writing end insert containing specified information, either semimonthly or at the time the employer pays the employee his or her wages. begin insert That specified information includes showing total hours worked by the employee, unless the employee’s compensation is solely based on a salary and the employee is exempt from payment of overtime under a specified statute or any applicable order of the Industrial Welfare Commission. end insert

This bill would begin delete make nonsubstantive changes to that requirement. end delete begin insert additionally exempt from that requirement for information on total work hours an employee exempt from payment of minimum wage and overtime whose compensation is not based in whole or in part on hours worked. end insert

Vote: majority. Appropriation: no. Fiscal committee:  begin delete no end delete begin insert yes end insert . State-mandated local program: no.

The people of the State of California do enact as follows:

SECTION 1.  

Section 226 of the Labor Code is amended to
read:

226.  

(a) An employer, semimonthly or at the time of each
payment of wages, shall furnish to his or her employee, either as
a detachable part of the check, draft, or voucher paying the
employee’s wages, or separately if wages are paid by personal
check or cash, an accurate itemized statement in writing showing
(1) gross wages earned, (2) total hours worked by the employee,
unless the begin insert employee is exempt from payment of minimum wage
and overtime and the employee’s compensation is not based in
whole or in part on hours worked or the end insert employee’s compensation
is solely based on a salary and the employee is exempt from
payment of overtime under subdivision (a) of Section 515 or any
applicable order of the Industrial Welfare Commission, (3) the
number of piece-rate units earned and any applicable piece rate if
the employee is paid on a piece-rate basis, (4) all deductions,
provided that all deductions made on written orders of the
employee may be aggregated and shown as one item, (5) net wages
earned, (6) the inclusive dates of the period for which the employee
is paid, (7) the name of the employee and only the last four digits
of his or her social security number or an employee identification
number other than a social security number, (8) the name and
address of the legal entity that is the employer and, if the employer
is a farm labor contractor, as defined in subdivision (b) of Section
1682, the name and address of the legal entity that secured the
services of the employer, and (9) all applicable hourly rates in
effect during the pay period and the corresponding number of hours
worked at each hourly rate by the employee and, beginning July
1, 2013, if the employer is a temporary services employer as
defined in Section 201.3, the rate of pay and the total hours worked
for each temporary services assignment. The deductions made
from payment of wages shall be recorded in ink or other indelible
form, properly dated, showing the month, day, and year, and a
copy of the statement and the record of the deductions shall be
kept on file by the employer for at least three years at the place of
employment or at a central location within the State of California.
For purposes of this subdivision, “copy” includes a duplicate of
the itemized statement provided to an employee or a
computer-generated record that accurately shows all of the
information required by this subdivision.

(b) An employer that is required by this code or any regulation
adopted pursuant to this code to keep the information required by
subdivision (a) shall afford current and former employees the right
to inspect or copy records pertaining to their employment, upon
reasonable request to the employer. The employer may take
reasonable steps to ensure the identity of a current or former
employee. If the employer provides copies of the records, the actual
cost of reproduction may be charged to the current or former
employee.

(c) An employer who receives a written or oral request to inspect
or copy records pursuant to subdivision (b) pertaining to a current
or former employee shall comply with the request as soon as
practicable, but no later than 21 calendar days from the date of the
request. A violation of this subdivision is an infraction.
Impossibility of performance, not caused by or a result of a
violation of law, shall be an affirmative defense for an employer
in any action alleging a violation of this subdivision. An employer
may designate the person to whom a request under this subdivision
will be made.

(d) This section does not apply to any employer of any person
employed by the owner or occupant of a residential dwelling whose
duties are incidental to the ownership, maintenance, or use of the
dwelling, including the care and supervision of children, or whose
duties are personal and not in the course of the trade, business,
profession, or occupation of the owner or occupant.

(e) (1) An employee suffering injury as a result of a knowing
and intentional failure by an employer to comply with subdivision
(a) is entitled to recover the greater of all actual damages or fifty
dollars ($50) for the initial pay period in which a violation occurs
and one hundred dollars ($100) per employee for each violation
in a subsequent pay period, not to exceed an aggregate penalty of
four thousand dollars ($4,000), and is entitled to an award of costs
and reasonable attorney’s fees.

(2) (A) An employee is deemed to suffer injury for purposes
of this subdivision if the employer fails to provide a wage
statement.

(B) An employee is deemed to suffer injury for purposes of this
subdivision if the employer fails to provide accurate and complete
information as required by any one or more of items (1) to (9),
inclusive, of subdivision (a) and the employee cannot promptly
and easily determine from the wage statement alone one or more
of the following:

(i) The amount of the gross wages or net wages paid to the
employee during the pay period or any of the other information
required to be provided on the itemized wage statement pursuant
to items (2) to (4), inclusive, (6), and (9) of subdivision (a).

(ii) Which deductions the employer made from gross wages to
determine the net wages paid to the employee during the pay
period. Nothing in this subdivision alters the ability of the employer
to aggregate deductions consistent with the requirements of item
(4) of subdivision (a).

(iii) The name and address of the employer and, if the employer
is a farm labor contractor, as defined in subdivision (b) of Section
1682, the name and address of the legal entity that secured the
services of the employer during the pay period.

(iv) The name of the employee and only the last four digits of
his or her social security number or an employee identification
number other than a social security number.

(C) For purposes of this paragraph, “promptly and easily
determine” means a reasonable person would be able to readily
ascertain the information without reference to other documents or
information.

(3) For purposes of this subdivision, a “knowing and intentional
failure” does not include an isolated and unintentional payroll error
due to a clerical or inadvertent mistake. In reviewing for
compliance with this section, the factfinder may consider as a
relevant factor whether the employer, prior to an alleged violation,
has adopted and is in compliance with a set of policies, procedures,
and practices that fully comply with this section.

(f) A failure by an employer to permit a current or former
employee to inspect or copy records within the time set forth in
subdivision (c) entitles the current or former employee or the Labor
Commissioner to recover a seven-hundred-fifty-dollar ($750)
penalty from the employer.

(g) The listing by an employer of the name and address of the
legal entity that secured the services of the employer in the itemized
statement required by subdivision (a) shall not create any liability
on the part of that legal entity.

(h) An employee may also bring an action for injunctive relief
to ensure compliance with this section, and is entitled to an award
of costs and reasonable attorney’s fees.

(i) This section does not apply to the state, to any city, county,
city and county, district, or to any other governmental entity, except
that if the state or a city, county, city and county, district, or other
governmental entity furnishes its employees with a check, draft,
or voucher paying the employee’s wages, the state or a city, county,
city and county, district, or other governmental entity shall use no
more than the last four digits of the employee’s social security
number or shall use an employee identification number other than
the social security number on the itemized statement provided with
the check, draft, or voucher.