Wage Law

California Governor Arnold Schwarzenegger has vetoed AB 2187, which would have created a prohibition against a person or an employer who, having the ability to pay, willfully fails to pay all wages due to an employee who has been discharged or who has quit within 90 days of the date of the wages becoming due, unless exempted, and would impose additional criminal penalties for that conduct.

Existing law makes it a misdemeanor for a person or employer who, having the ability to pay, willfully refuses to pay wages due to a current employee, an employee who has resigned, or an employee who has been discharged. Under existing law, an aggrieved employee has the right to restitution for unpaid wages. Existing law also imposes civil penalties against a person or employer who wrongfully fails to pay wages. AB 2187 would create a separate prohibition against a person or an employer who, having the ability to pay, willfully fails to pay all wages due to an employee who has been discharged or who has quit within 90 days of the date of the wages becoming due, unless exempted, and would impose additional criminal penalties for that conduct. The bill would also require a person or employer who violates these provisions to pay restitution in an amount equal to the amount of unpaid wages to the aggrieved employee upon conviction.

It would have added a new section 1199.6 to the Labor Code, to read:

1199.6.  (a) In addition to any other penalty imposed, an employer
or other person acting either individually or as an officer, agent,
or employee of another person is guilty of a misdemeanor and is
punishable by a fine of not less than one thousand dollars ($1,000)
and not more than ten thousand dollars ($10,000), or by imprisonment
in a county jail for not more than six months, or by both, who,
having the ability to pay, willfully fails to pay all wages due to an
employee who has been discharged or who has quit within 90 days of
the date that those wages became due. This section does not apply if
the employee's entitlement to unpaid wages is disputed by the
employer in a civil action or proceeding by the Labor Commissioner
unless a final judgment is entered with respect to that dispute in
favor of the employee.
   (b) An employer or other person guilty of a misdemeanor under
subdivision (a) shall pay, in addition to any criminal fines,
restitution to the aggrieved employee in an amount equal to the total
amount of unpaid wages.
   (c) As used in this section, "willfully" has the same meaning as
provided in Section 7 of the Penal Code.

The Governor's veto message reads:

I am returning Assembly Bill (AB) 2187 without my signature.

AB 2187 would create a new criminal prohibition against a person or an employer who, having the ability to pay, willfully fails to pay all wages to an employee who has been discharged or who has quit within 90 days of the date of the wages becoming due. The bill contains an exemption for instances in which the employee’s entitlement to unpaid wages is disputed by the employer in a civil action or proceeding by the Labor Commissioner unless there is a final judgment in favor of the employee.

Waiting time penalties and defined timeframes for the payment of final wages currently exist in California law, as do mechanisms for enforcement of these obligations. Therefore, this bill is unnecessary.

For this reason, I am returning this bill without my signature

Thus, while employers who don't exploit their employees are unaffected by the bill or the veot, the worst of California's worst employers can sleep a little easier at night, not that it matters that much. Nobody prosecutes these cases in the first place.