BILL ANALYSIS
AB 1133
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Date of Hearing: April 23, 2003
ASSEMBLY COMMITTEE ON LABOR AND EMPLOYMENT
Paul Koretz, Chair
AB 1133 (Koretz) - As Amended: March 25, 2003
SUBJECT : Employment.
SUMMARY : Imposes an automatic penalty equal to 100% of the
outstanding judgment for every six months that employers do not
pay their wage and hour judgments. Specifically, this bill :
1)Declares that, if any judgment for nonpayment of wages or
penalties remains unpaid for six months after the time to
appeal the judgment has expired or any appeal has been
concluded, the amount of the judgment shall double.
2)Provides that the amount of the judgment is again doubled for
each additional six month period for which the judgment
remains unpaid.
3)Requires a court to award attorney's fees and costs to the
employee or the Labor Commissioner who enforces such a
judgment.
EXISTING LAW :
1)Authorizes an employee to file an administrative claim with
the Labor Commissioner or to bring a civil action against an
employer for the nonpayment of wages and penalties. An
employee who brings an action is entitled to recover costs and
attorney's fees.
2)Authorizes the Labor Commissioner to require an employer to
deposit a bond where the employer has failed to pay any
judgment for the nonpayment of wages for more than 10 days
after the time to appeal the judgment has expired.
3)Authorizes an employee, where an employer has violated the law
or failed to pay a judgment twice within a ten year period, to
bring an action for a temporary restraining order prohibiting
the employer from doing business in the state until the
employer deposits a bond to satisfy the unpaid judgment.
FISCAL EFFECT : Unknown
AB 1133
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COMMENTS : Supporters argue that this bill would hold employers
accountable who try to circumvent the law by not paying wage and
hour judgments lawfully entered against them. The sponsors of
the bill state that there are many cases where employees go
through the entire wage claim adjudication process with the
Labor Commissioner, win their judgment and are still unable to
receive their unpaid wages or penalties because the employer
simply refuses to pay. Since the amount of such judgments is
generally not sufficient to make collection by a collection
agency profitable, workers receive little, if any, further
assistance in recovering their owed wages or penalties.
Supporters state that this bill not only encourages employers to
pay their judgments and pay them on time, but it also increases
the incentive for collection agencies to accept low-wage
workers' cases once the penalties begin to accrue. Supporters
also point out that the provisions of this bill do not trigger
until six months after the time to appeal a judgment has
expired, or such an appeal has been concluded, when there is no
justification for an employer to refuse to satisfy the judgment.
Opponents argue that this bill is gross overkill and would set a
new and very onerous precedent for employers. Opponents state
that wage judgments should only be subject to a reasonable
penalty or a set amount of interest. Opponents also object to
the provisions of the bill allowing for the recovery of
attorneys' fees and costs. Instead, once the Labor Commissioner
has entered a judgment, it should be the sole responsibility of
the Labor Commissioner to enforce payment of the judgment.
REGISTERED SUPPORT / OPPOSITION :
Support
American Apparel
Asian Pacific American Legal Center (CoSponsor)
Bet Tzedek Legal Services (CoSponsor)
California Conference Board of the Amalgamated Transit Union
California Conference of Machinists
California Employment Lawyers Association
California Independent Public Employees Legislative Council
California Labor Federation, AFL-CIO
California Organization of Police and Sheriffs
California Professional Firefighters
AB 1133
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California Rural Legal Assistance Foundation
California Teamsters Public Affairs Council
Coalition for Humane Immigrant Rights of Los Angeles
Engineers & Scientists of California
Garment Worker Center (CoSponsor)
Hotel Employees, Restaurant Employees International Union
Korean Immigrant Worker Advocates (CoSponsor)
La Raza Centro Legal, Inc.
Los Angeles Worker Advocates (CoSponsor)
Maintenance Cooperation Trust Fund (CoSponsor)
Peace Officers Research Association of California
Professional and Technical Engineers, Local 20
Sweatshop Watch (CoSponsor)
Union of Needletrades, Industrial and Textile Employees
(CoSponsor)
United Food & Commercial Workers Region 8 States Council
Opposition
California Chamber of Commerce
California Manufacturers & Technology Association
Analysis Prepared by : Ben Ebbink / L. & E. / (916) 319-2091