California Legislature—2013–14 Regular Session

Assembly Bill No. 442

Introduced by Assembly Member Nazarian

February 19, 2013

An act to amend Sections 1194.2 and 1197.1 of the Labor Code, relating to employment.

LEGISLATIVE COUNSEL’S DIGEST

AB 442, as introduced, Nazarian. Employees: wages.

Existing law authorizes the Labor Commissioner to investigate and enforce statutes and orders of the Industrial Welfare Commission that, among other things, specify the requirements for the payment of wages by employers. Existing law provides for criminal and civil penalties for violations of statutes and orders of the commission regarding payment of wages. Existing law authorizes the Labor Commissioner to recover liquidated damages for an employee who brings a complaint alleging payment of less than the minimum wage fixed by an order of the commission or by statute.

Existing law subjects any employer, who pays or causes to be paid to any employee a wage less than the minimum fixed by an order of the commission or by statute, to a citation that includes a civil penalty and the payment of restitution of wages to the employee.

This bill would expand that penalty and restitution provision for a citation to also subject the employer to payment of liquidated damages to the employee.

Vote: majority. Appropriation: no. Fiscal committee: yes. State-mandated local program: no.

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

SECTION 1.  

Section 1194.2 of the Labor Code is amended to
read:

1194.2.  

(a) In any action under Section 98, 1193.6, begin delete or end delete 1194 begin insert ,
or 1197.1 end insert to recover wages because of the payment of a wage less
than the minimum wage fixed by an order of the commission or
by statute, an employee shall be entitled to recover liquidated
damages in an amount equal to the wages unlawfully unpaid and
interest thereon. Nothing in this subdivision shall be construed to
authorize the recovery of liquidated damages for failure to pay
overtime compensation.

(b) Notwithstanding subdivision (a), if the employer
demonstrates to the satisfaction of the court or the Labor
Commissioner that the act or omission giving rise to the action
was in good faith and that the employer had reasonable grounds
for believing that the act or omission was not a violation of any
provision of the Labor Code relating to minimum wage, or an order
of the commission, the court or the Labor Commissioner may, as
a matter of discretion, refuse to award liquidated damages or award
any amount of liquidated damages not exceeding the amount
specified in subdivision (a).

(c) This section applies only to civil actions commenced on or
after January 1, 1992.

SEC. 2.  

Section 1197.1 of the Labor Code is amended to read:

1197.1.  

(a) Any employer or other person acting either
individually or as an officer, agent, or employee of another person,
who pays or causes to be paid to any employee a wage less than
the minimum fixed by an order of the commission shall be subject
to a civil penalty begin delete and end delete begin insert , end insert restitution of wages begin insert , and liquidated damages end insert
payable to the employee, as follows:

(1) For any initial violation that is intentionally committed, one
hundred dollars ($100) for each underpaid employee for each pay
period for which the employee is underpaid. This amount shall be
in addition to an amount sufficient to recover underpaid wages
begin insert and liquidated damages pursuant to Section 1194.2 end insert .

(2) For each subsequent violation for the same specific offense,
two hundred fifty dollars ($250) for each underpaid employee for
each pay period for which the employee is underpaid regardless
of whether the initial violation is intentionally committed. This
amount shall be in addition to an amount sufficient to recover
underpaid wages begin insert and liquidated damages pursuant to Section
1194.2 end insert .

(3) Wages begin insert and liquidated damages end insert recovered pursuant to this
section shall be paid to the affected employee.

(b) If, upon inspection or investigation, the Labor Commissioner
determines that a person has paid or caused to be paid a wage less
than the minimum, the Labor Commissioner may issue a citation
to the person in violation. The citation may be served personally
or by registered mail in accordance with subdivision (c) of Section
11505 of the Government Code. Each citation shall be in writing
and shall describe the nature of the violation, including reference
to the statutory provision alleged to have been violated. The Labor
Commissioner promptly shall take all appropriate action, in
accordance with this section, to enforce the citation and to recover
the civil penalty assessed begin delete and end delete begin insert , end insert wages begin insert , and liquidated damages end insert in
connection with the citation.

(c)  begin insert (1) end insert begin insert   end insert If a person desires to contest a citation or the proposed
assessment of a civil penalty begin delete and end delete begin insert , end insert wages begin insert , and liquidated damages end insert
therefor, the person shall, within 15 business days after service of
the citation, notify the office of the Labor Commissioner that
appears on the citation of his or her request for an informal hearing.
The Labor Commissioner or his or her deputy or agent shall, within
30 days, hold a hearing at the conclusion of which the citation or
proposed assessment of a civil penalty begin delete and end delete begin insert , end insert wages begin insert , and liquidated
damages end insert shall be affirmed, modified, or dismissed.

begin delete

The

end delete

begin insert (2) end insert begin insert   end insert begin insert The end insert decision of the Labor Commissioner shall consist of a
notice of findings, findings, and an order, all of which shall be
served on all parties to the hearing within 15 days after the hearing
by regular first-class mail at the last known address of the party
on file with the Labor Commissioner. Service shall be completed
pursuant to Section 1013 of the Code of Civil Procedure. Any
amount found due by the Labor Commissioner as a result of a
hearing shall become due and payable 45 days after notice of the
findings and written findings and order have been mailed to the
party assessed. A writ of mandate may be taken from this finding
to the appropriate superior court. The party shall pay any judgment
and costs ultimately rendered by the court against the party for the
assessment. The writ shall be taken within 45 days of service of
the notice of findings, findings, and order thereon.

(d) A person to whom a citation has been issued shall, in lieu
of contesting a citation pursuant to this section, transmit to the
office of the Labor Commissioner designated on the citation the
amount specified for the violation within 15 business days after
issuance of the citation.

(e) When no petition objecting to a citation or the proposed
assessment of a civil penalty begin delete and end delete begin insert , end insert wages begin insert , and liquidated damages end insert
is filed, a certified copy of the citation or proposed civil penalty
begin delete and end delete begin insert , end insert wages begin insert , and liquidated damages end insert may be filed by the Labor
Commissioner in the office of the clerk of the superior court in
any county in which the person assessed has or had a place of
business. The clerk, immediately upon the filing, shall enter
judgment for the state against the person assessed in the amount
shown on the citation or proposed assessment of a civil penalty
begin delete and end delete begin insert , end insert wages begin insert , and liquidated damages end insert .

(f) When findings and the order thereon are made affirming or
modifying a citation or proposed assessment of a civil penalty begin delete and end delete begin insert , end insert
wages begin insert , and liquidated damages end insert after hearing, a certified copy of
these findings and the order entered thereon may be entered by
the Labor Commissioner in the office of the clerk of the superior
court in any county in which the person assessed has property or
in which the person assessed has or had a place of business. The
clerk, immediately upon the filing, shall enter judgment for the
state against the person assessed in the amount shown on the
certified order.

(g) A judgment entered pursuant to this section shall bear the
same rate of interest and shall have the same effect as other
judgments and be given the same preference allowed by the law
on other judgments rendered for claims for taxes. The clerk shall
make no charge for the service provided by this section to be
performed by him or her.

(h) The civil penalties provided for in this section are in addition
to any other penalty provided by law.

(i) This section shall not apply to any order of the commission
relating to household occupations.