Labor Code Section 558 and PAGA. The Court of Appeal also held that such underpaid wages may also be … Posted in California Developments. Sec. The California legislature played an active role in 2015 by enacting new rules and amendments in many employment areas. In ZB, N.A. v. Superior Court (Lawson) (Sept. 12, 2019), the California Supreme Court held that plaintiffs cannot recover the unpaid wages described in Labor Code section 558 in a Private Attorneys General Act of 2004 (PAGA) claim. Under Labor Code section 558.1, anyone who is an owner, director, officer or managing agent of an employer and who violates the Labor Code, or causes it to be violated, “may be held liable as the employer for such violation.” Individuals may face potential liability for the following: Unpaid minimum wages; The dispute in ZB centered on the language of Labor Code Section 558. By Rafael N. Tumanyan & Emily Burkhardt Vicente on September 13, 2019. Labor Code Section 558 provides the Labor Commissioner authority to collect a civil penalty for certain Labor Code violations relating to overtime and hours and days of work, equal to $50 to $100 dollars for each underpaid employee for each pay period for which the employee was underpaid, in addition to “an amount sufficient to recover underpaid wages.” This ruling drastically limits the amount of penalties that plaintiffs can attempt to recover in PAGA actions. This law, enacting Assembly Bill No. GENERAL LABOR CODE SECTION 500-558 500. § 558.1 (a) Any employer or other person acting on behalf of an employer, who violates, or causes to be violated, any provision regulating minimum wages or hours and days of work in any order of the Industrial Welfare Commission, or violates, or causes to be violated, Sections 203, 226, 226.7, 1193.6, 1194, or 2802, may be held liable as the employer for such violation. — with whom she agreed to arbitrate all employment claims and forego class arbitration — and its parent company, Zions Bancorporation (collectively, ZB). Labor Code Section 558.1 Legislative Updates Employers Should Know About to Avoid Wringing in the New Year. For purposes of this chapter, the following terms shall have the following meanings: (a) "Workday" and "day" mean any consecutive 24-hour period commencing at … PAGA claims for civil penalties are subject to a one-year statute of limitations rather than the three-year period available for claims to recover wages. California Labor Code LAB CA LABOR Section 558.1. Labor Code Section 558.1. In the very last paragraph of SB 588, a new Labor Code §558.1 was added which, for the first time, creates individual liability for owners, directors, officers, or managing agents of an employer for violations of certain sections of the California Labor Code. Examining Labor Code Section 558.1. In Lawson v.ZB, N.A. In Martinez v. Combs, the California Supreme Court adopted a broad definition of … Director: means Director of Industrial Relations.See California Education Code 32390; Person: means any person, association, organization, partnership, business trust, limited liability company, or corporation.See California Education Code 32289; Violation: includes a failure to comply with any requirement of the code. Julie Totten and Julia Riechert Posted on January 4, 2016. Section 558.1 expressly defines “employer or other person acting on behalf of an employer” to include a “natural person who is an owner, director, officer, or managing agent of the employer.” Accordingly, potentially any managing agent who “causes” a wage and hour Labor Code provision to be violated could be held personally liable. Before California Labor Code 558.1 provides as follows: Section 558 can be invoked only by the Labor Commissioner or by an individual suing under PAGA, and PAGA claims are limited to the recovery of civil penalties. Section 558 of the California Labor Code is a civil penalty statute permitting the Labor Commissioner to issue citations for: (1) civil penalties, which are to be dispersed to the state, and (2) “underpaid wages,” which are to be dispersed directly to the underpaid employees. CA Labor Code § 558.1 (2017) (a) Any employer or other person acting on behalf of an employer, who violates, or causes to be violated, any provision regulating minimum wages or hours and days of work in any order of the Industrial Welfare Commission, or violates, or causes to be violated, Sections 203, 226, 226.7, 1193.6, 1194, or 2802, may be held liable as the employer for such violation. Seyfarth Synopsis: The California Supreme Court has held that an individual may not seek unpaid wages under Labor Code section 558. (e) This section does not change the applicability of … Labor Code section 558.1 does not apply to lower-level managers and supervisors. Section 558.1 (a) Any employer or other person acting on behalf of an employer, who violates, or causes to be violated, any provision regulating minimum wages or hours and days of work in any order of the Industrial Welfare Commission, or violates, or causes to be violated, Sections 203, 226, 226.7, 1193.6, 1194, or 2802, may be held liable as the employer for such violation. Labor Code Section 558 and PAGA. Our review of the annotated history reveals the following legislative history (every “c.” below represents a separate legislative bill): Added: 1999, c. 134 (AB 60) Amended: 2015, c. 783 (AB 970) to amend (b) and add (c) and (e) Section 558 authorizes the Labor Commissioner to seek a civil penalty in connection with overtime and other workday violations at an initial violation rate of $50 for each underpaid employee for each pay period and a subsequent violation rate of $100 for each underpaid employee for each pay period. 2005 California Labor Code Sections 500-558 CHAPTER 1. … On February 27, 2012, in Thurman v. Bayshore Transit Management, Inc., the California Court of Appeal affirmed a trial court's award of underpaid "wages" – i.e., premium payments for violations of California's meal and rest period laws and regulations – as a penalty under California Labor Code section 558. However, as the Court explained, while section 558 gave the state exclusive power to collect unpaid wages through its citation procedure, section 558 achieves the same result with respect to unpaid wages as a private right of action for unpaid wages under Labor Code section 1194 does. Read the code on FindLaw (d) The civil penalties provided for in this section are in addition to any other civil or criminal penalty provided by law. Brought by real party in interest Kalethia Lawson, the action named as defendants Lawson’s employer, ZB, N.A. Therefore, employees who have been wronged by an organization (or those acting on behalf of them) should seek legal counsel in matters of this nature. California Supreme Court Limits Potential Recovery Under PAGA. The Court compared Section 558 to Labor Code Section 1197.1, which allows the Labor Commissioner to issue a citation that includes a fixed component and underpaid wages component. However, those individuals may be liable for certain wage and hour violations under case law and the Wage Orders. However, Plaintiff’s claims for violations of Labor Code Sections 226.3 and 558 were subject to the notice and cure provisions set forth in Labor Code section 2699.3(c) which does not require a return notice from the LWDA, but does require an employee to wait 33 days to allow the employer to cure the alleged violation before an employee can commence a civil suit. under Labor Code section 558. Section 558.1 expressly defines “employer or other person acting on behalf of an employer” to include a “natural person who is an owner, ... See Labor Code Section 2802. But the PAGA is not a per - fect remedy for employees. Labor Code Section 558. Section 558 of the California Labor Code is a civil penalty statute permitting the Labor Commissioner to issue citations for: (1) civil penalties, which are to be dispersed to the state, and (2) "underpaid wages," which are to be dispersed directly to the underpaid employees. If the Labor Commissioner issues a citation, the local entity shall not cite the employer for the same violation. California has a very large exception to corporate limited liability when it comes to unpaid wages, late paid wages, and other common wage-and-hour violations through California Labor Code Section 558.1. and Labor Code Section 558. Terms Used In California Labor Code 558.1. ZB, N.A. Compiled September, 2020. California Labor Code § 558.1, effective January 1, 2016, states that an employer or “other person acting on behalf of an employer” who violates California’s wage and hour laws “may be held liable as the employer. (2018) 18 Cal.App.5th 705, California’s Fourth District Court of Appeal recently ruled that the two elements comprising damages under Labor Code § 558 – (a) underpaid wages and (b) denominated assessments – are indivisible. Labor Code Section 558.1 Liability. v. Superior Court of San Diego County. California Labor Code section 558 provides for the recovery of: “a civil penalty as follows: (1) For any initial violation, fifty dollars ($50) for each underpaid employee for each pay period for which the employee was underpaid in addition to an amount sufficient to recover underpaid wages. Labor Code Section 558. Labor Code section 558 – California Employment Law Report In ZB, N.A. Last week, California enacted new legislation updating the prohibition on employers inquiring into the salary history of their applicants and the requirement that employers respond to applicants’ requests for the pay scale for positions. 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