Personal Liability for Employers Under A Fair Day’s Pay Act

A San Diego employment litigation attorney at Gehres Law Group, P.C. can provide assistance to companies accused of wage-and-hour violations, as well as to individuals who could potentially face personal liability under California’s Fair Day’s Pay Act. 

Could Owners or Directors Face Personal Liability for Unpaid Wages?

California’s Fair Day’s Pay Act stipulates that owners, directors, managing agents, or officers could be held personally liable for wage and hour violations under California Labor Code section 558.1.

The bill established provisions through which Labor Commissioners could enforce judgements against owners, directors, and others who can be held liable for wage theft, including placing levies on bank accounts and personal property. The goal of the bill is, in part, to ensure employers cannot escape liability for unpaid wages by closing companies and starting new ones.

Wage and hour violations that could give rise to personal liability include failure to pay minimum wage, failure to pay overtime, failure to pay for off-the-clock work, theft of tips, and failure to pay final wages to workers.

Those who are held personally liable under the bill could be liable for not just unpaid overtime wages, but also situations where miscalculations of the regular rate resulted in employees being underpaid. Owners, directors, and others who are held liable under the bill could also be held personally responsible for unreimbursed business expenses, for rest and meal premiums associated with missed breaks, and for providing wage statements to employees that do not meet all of the requirements set forth in California’s Labor Code section 226.

The law also stipulates that employers who have previously been found to have committed wage violations could be required to post bond before continuing operations.

An analysis of the Fair Day’s Pay Act conducted by the Senate Judiciary Committee indicated the law was necessary because cases of wage theft have been increasing, depriving workers of the money that they have earned. According to the brief of the bill by the committee, a UCLA study found that an estimated 654,914 workers just in LA County alone experience at least one violation of wage-and-hour laws weekly. Estimates also suggest that front-line workers who work within low-wage industries lose in excess of $26.2 million weekly due to wage and hour violations.

The California Labor Commissioner Julie Su has also indicated that she has sought, and will seek, to enforce criminal provisions of the Fair Day’s Pay Act if employers commit wage theft.

Employers face significant personal risk under the Fair Day’s Pay Act because of these provisions imposing personal financial liability and because of the provisions enhancing the tools for enforcement of wage and hour laws.

Getting Help from a San Diego Employment Litigation Attorney

It is imperative to get legal help if you or your company has been accused of violating any wage and hour laws as a substantial amount of money could be at stake, along with potential impacts on both ongoing business operations and personal financial security.

Gehres Law Group, P.C. is here to help. Give us a call at 858-964-2314 or contact us online to find out more about the assistance our legal team can offer in connection with wage and hour claims under the Fair Day’s Pay Act.

The post Personal Liability for Employers Under A Fair Day’s Pay Act appeared first on Gehres Law Group.

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