Wage Law

Existing law, the Domestic Worker Bill of Rights (Labor Code section 1451-1453), regulates the hours of work of domestic work employees who are personal attendants and provides an overtime compensation rate for those employees. The Domestic Worker Bill of Rights defines terms for its purposes and requires the Governor to convene a committee to study and report to the Governor on the effects of its provisions on personal attendants and their employers.

Pursuant to Labor Code section 1453, the Domestic Worker Bill of Rights would be repealed as of January 1, 2017. SB 1015 deletes that repeal date. By extending the effect of the Domestic Worker Bill of Rights, the violation of which is a misdemeanor, this bill would expand the definition of a crime, which would impose a state-mandated local program. Here is the full text of the heart of the Domestic Worker Bill of Rights, Labor Code section 1451:

1451.  As used in this part, the following definitions apply:
   (a) (1) "Domestic work" means services related to the care of persons in private households or maintenance of private households or their premises. Domestic work occupations include childcare
providers, caregivers of people with disabilities, sick, convalescing, or elderly persons, house cleaners, housekeepers, maids, and other household occupations.
   (2) "Domestic work" does not include care of persons in facilities providing board or lodging in addition to medical, nursing, convalescent, aged, or child care, including, but not limited to,
residential care facilities for the elderly.
   (b) (1) "Domestic work employee" means an individual who performs domestic work and includes live-in domestic work employees and personal attendants.
   (2) "Domestic work employee" does not include any of the
following:
   (A) Any person who performs services through the In-Home Supportive Services program under Article 7 (commencing with Section 12300) of Chapter 3 of Part 3 of Division 9 of, or Sections 14132.95, 14132.952, and 14132.956 of, the Welfare and Institutions Code.
   (B) Any person who is the parent, grandparent, spouse, sibling, child, or legally adopted child of the domestic work employer.
   (C) Any person under 18 years of age who is employed as a babysitter for a minor child of the domestic work employer in the employer's home.
   (D) Any person employed as a casual babysitter for a minor child
in the domestic employer's home. A casual babysitter is a person whose employment is irregular or intermittent and is not performed by an individual whose vocation is babysitting. If a person who
performs babysitting services on an irregular and intermittent basis does a significant amount of work other than supervising, feeding, and dressing a child, this exemption shall not apply and the person
shall be considered a domestic work employee. A person who is a casual babysitter who is over 18 years of age retains the right to payment of minimum wage for all hours worked, pursuant to Wage Order
No. 15-2001 of the Industrial Welfare Commission.
   (E) Any person employed by a licensed health facility, as defined in Section 1250 of the Health and Safety Code.
   (F) Any person who is employed pursuant to a voucher issued through a regional center or who is employed by, or contracts with, an organization vendored or contracted through a regional center or the State Department of Developmental Services pursuant to the Lanterman Developmental Disabilities Services Act (Division 4.5 (commencing with Section 4500) of the Welfare and Institutions Code) or the California Early Intervention Services Act (Title 14 (commencing with Section 95000) of the Government Code) to provide services and support for persons with developmental disabilities, as defined in Section 4512 of the Welfare and Institutions Code, when any funding for those services is provided through the State Department of Developmental Services.
   (G) Any person who provides child care and who, pursuant to subdivision (d) or (f) of Section 1596.792 of the Health and Safety Code, is exempt from the licensing requirements of Chapters 3.4 (commencing with Section 1596.70), 3.5 (commencing with Section 1596.90), and 3.6 (commencing with Section 1597.30) of Division 2 of the Health and Safety Code, if the parent or guardian of the child to whom child care is provided receives child care and development services pursuant to any program authorized under the Child Care and Development Services Act (Chapter 2 (commencing with Section 8200) of Part 6 of Division 1 of Title 1 of the Education Code) or the California Work Opportunity and Responsibility to Kids Act (Chapter 2 (commencing with Section 11200) of Part 3 of Division 9 of the Welfare and Institutions Code).
   (c) (1) "Domestic work employer" means a person, including corporate officers or executives, who directly or indirectly, or through an agent or any other person, including through the services of a third-party employer, temporary service, or staffing agency or similar entity, employs or exercises control over the wages, hours, or working conditions of a domestic work employee.
   (2) "Domestic work employer" does not include any of the following:
   (A) Any person or entity that employs or exercises control over the wages, hours, or working conditions of an individual who performs domestic work services through the In-Home Supportive Services program under Article 7 (commencing with Section 12300) of Chapter 3 of Part 3 of Division 9 of, or Sections 14132.95, 14132.952, and 14132.956 of, the Welfare and Institutions Code or who is eligible for that program.
   (B) An employment agency that complies with Section 1812.5095 of the Civil Code and that operates solely to procure, offer, refer, provide, or attempt to provide work to domestic workers if the relationship between the employment agency and the domestic workers for whom the agency procures, offers, refers, provides, or attempts to provide domestic work is characterized by all of the factors listed in subdivision (b) of Section 1812.5095 of the Civil Code and Section 687.2 of the Unemployment Insurance Code.
   (C) A licensed health facility, as defined in Section 1250 of the
Health and Safety Code.
   (d) "Personal attendant" means any person employed by a private householder or by any third-party employer recognized in the health care industry to work in a private household, to supervise, feed, or dress a child, or a person who by reason of advanced age, physical disability, or mental deficiency needs supervision. The status of personal attendant shall apply when no significant amount of work other than the foregoing is required. For purposes of this subdivision, "no significant amount of work" means work other than the foregoing did not exceed 20 percent of the total weekly hours worked.

Now that the California minimum wage has increased to $10 per hour as of January 1, 2016, California employers must also pay more to keep exempt workers exempt. In addition to the Duties Test, California employers who classify workers as salaried exempt must meet the Salary Test. Among other things, this means that the salary must be no less than double the minimum wage for full time work.

A full-time minimum wage earner now makes $20,800 per year. Thus, a salaried exempt worker must be paid at least $41,600 annually to meet the California standards ($10 per hour x 40 hours per week x 52 weeks per year, doubled).

Failure to meet this standard can prove costly, even if an employee only works an extra 30 to 60 minutes per day. A worker who is misclassified as exempt who works an extra 45 minutes a day, at $40,000 a year, would accrue an overtime liability of $5,625 per year. Employees can reach back four years under California's statute of limitations, so that could grow to $22,500 over four years, for just one worker. Make the same mistake with a staff of 45 employees and you're looking at a seven figure liability.

Effective January 1, 2016, the minimum wage in California is $10.00 per hour.

The minimum wage applies to adults and minors, tipped and non-tipped employees in California.

If you are a sheepherder, in which case your minimum wage is a monthly salary of $1,777.98.

Employers take note: Wages paid to sheepherders may not be offset by meals or lodging provided by the employer. Instead, there are provisions in IWC Order 14-2007, Sections 10(F), (G) and (H) that apply to sheepherders with respect to monthly meal and lodging benefits required to be provided by the employer.

We love Chinatown, but it is teeming with employers who oppress their laborers and refuse to pay minimum wage and overtime, or violate other labor laws such as those requiring meal and rest breaks. The latest violator is Dick Lee Pastry, a poorly reviewed restaurant in San Franscisco's Chinatown. Dick Lee Pastry was recently ordered to pay back wages and penalties after forcing employees to work up to 80 hours per week for under $4 per hour. According to the San Francisco Chronicle, Dick Lee Pastry paid $525,000 to settle the wage theft claims. But it wasn't the first, and it won't be the last.

Places with large concentrations of immigrant workers are notorious violators of California wage and hour laws. Sadly, this is even true when the employers are also immigrants, even of the same ethnicity. The more vulnerable the worker, the higher the probability that they are going to be exploited.

AB 1744 has been signed into law. Current law under Labor Code § 226 requires every employer, semimonthly or at the time of each payment of wages, to furnish each employee with an accurate itemized statement in writing showing certain information including hours worked, pay rates, deductions and similar information. Current law provides that a knowing and intentional violation of this provision is a misdemeanor. AB 1744 adds a requirement for temporary services employers to include the rate of pay and the total hours worked for each assignment, with certain specified exceptions. Temporary services employers must also include the physical address of the main office, the mailing address if different from the physical address of the main office, and the telephone number of the legal entity for whom the employee will perform work.

The law becomes effective July 1, 2013. It will incorporate changes to Labor Code § 226 under SB 1255 and AB 2674, and shall be chaptered last among those three bills.

You can read the full text of the bill here in PDF.

California Governor Arnold Schwarzenegger has vetoed AB 1881, which would have provided for double liquidated damages in civil actions on minimum wage violations

Under existing law, in a court action to recover wages unpaid in violation of the minimum wage, the court may award liquidated damages to an employee equal to the amount of wages unlawfully unpaid, plus interest. Essentially, the employer is liable merely for the wages it should have paid in the first place. AB 1881 would have increased the amount of liquidated damages that may be awarded to an employee to twice the amount of the wages unlawfully unpaid, plus interest.

The Governor's veto message reads:

To the Members of the California State Assembly:

I am returning Assembly Bill 1881 without my signature.

This bill would increase liquidated damages in civil actions for minimum wage violations to twice the wages unlawfully unpaid and interest thereon.

Existing law allows for liquidated damages equal to wages owed, in addition to interest, other penalties, and attorneys’ fees. There is no information to show that the existing enforcement and protections of California’s minimum wage laws are insufficient.

Consequently, I am returning this bill without my signature.

Mark Schacht, deputy director of the California Rural Legal Assistance Foundation, put it this way: "This Republican governor, like all recent Republican governors, has been content to leave state labor agencies underfunded and to aggressively restrict expansion of private remedies for enforcement." The vetoes essentially defend "the worst actors in the underground economy, and the governor and his allies at the Chamber of Commerce know it."

This veto is one of the last in a six year battle between Schwarzenegger and the legislature over minimum wage issues. The November election should have a significant effect upon the future of California's wage and hour laws. If we had to guess, we'd guess that Meg Whitman would have given this a veto, too, but that Jerry Brown would have signed it.