BILL ANALYSIS �
AB 442
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Date of Hearing: April 10, 2013
ASSEMBLY COMMITTEE ON LABOR AND EMPLOYMENT
Roger Hern�ndez, Chair
AB 442 (Nazarian) - As Introduced: February 19, 2013
SUBJECT : Employees: wages.
SUMMARY : Provides that a citation issued by the Labor
Commissioner (LC) for failure to pay minimum wage shall include
liquidated damages, as already available under existing law in
civil actions or administrative wage claim actions.
EXISTING LAW :
1)Provides that an employee who receives less than the minimum
wage is entitled to recover in a civil action, the unpaid
balance of the full amount of the minimum wage, liquidated
damages in an amount equal to the wages unlawfully unpaid and
interest thereon, reasonable attorney's fees and costs of
suit.
2)Provides that in a wage claim brought before the LC for
failure to pay minimum wage, an employee shall be entitled to
recover liquidated damages in an amount equal to the wages
unpaid and interest thereon.
3)Provides that if the employer demonstrates to the satisfaction
of the court or the LC that the failure to pay minimum wage
was in good faith and that the employer had reasonable grounds
for believing that the act or omission was not a violation of
the law, the court or the LC may, as a matter of discretion,
refuse to award liquidated damages or reduce the amount of
liquidated damages.
4)Provides that, in a citation for a minimum wage violation
issued by the LC, an employer shall be subject to a specified
civil penalty and restitution of wages.
FISCAL EFFECT : Unknown
COMMENTS : This bill is sponsored by the California Rural Legal
Assistance Foundation (CRLAF) who argues that it will provide
that when the Labor Commissioner, after an inspection or
investigation, issues a citation against an employer for failure
AB 442
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to pay minimum wages to his/her employees, the LC is also able
to recover for those employees the unpaid minimum wage
"liquidated damages" available elsewhere under state law.
Under Labor Code section 1194, an employee who receives less
than the minimum wage is entitled to recover in a civil action,
the unpaid balance of the full amount of the minimum wage,
liquidated damages in an amount equal to the wages unlawfully
unpaid and interest thereon, reasonable attorney's fees and
costs of suit.
AB 240 (Bonilla) of 2011 amended Labor Code sections 1194.2 and
98 to authorize the Labor Commissioner to award unpaid minimum
wage liquidated damages in administrative wage claim hearings
under the same conditions that existed for allowing a court to
award those same damages to workers.
CRLAF contends that this bill fills the one remaining gap in the
LC's authority to make workers whole in minimum wage violation
cases. This bill provides that the LC may also subject the
minimum wage violator to payment of "liquidated damages" to the
employee. CRLAF argues that this change to the law ensures that
regardless of where wage theft is found, employees cheated out
of wages will get what the law intends: restitution of the
amount of unpaid minimum wages AND an amount equal to the total
amount of unpaid minimum wages (as "liquidated damages").
CRLAF contends that the failure to enact this bill will create
new costs to the Division of Labor Standards Enforcement (DLSE)
and cause delays for workers entitled to liquidated damages.
Specifically, they argue that because the award of liquidated
damages is mandatory when minimum wages have not been paid, the
failure to recover those damages for the worker after a citation
is issued will likely result in the worker bringing a separate
claim before the LC. This adds unnecessary new costs to DLSE
and also adds delays for workers who have been cheated of wages
and deserve full compensation.
REGISTERED SUPPORT / OPPOSITION :
Support
California Rural Legal Assistance Foundation (sponsor)
Opposition
AB 442
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None on file.
Analysis Prepared by : Ben Ebbink / L. & E. / (916) 319-2091