Wage theft is a term that covers a number of different types of pay violations. Wage theft is said to have occurred when employers shortchange their workers by not paying them the minimum wage, required overtime, make improper deductions or refuse to pay them altogether. Low-income workers, who comprise about a third of California's workforce, are particularly vulnerable because they could face financial devastation when their employer does not pay them the wages that are due.
These are individuals who often perform low-paying jobs such as washing cars, waiting tables, picking fruits and vegetables, stocking warehouses, sewing clothes and cleaning restaurants. But, any worker can become the victim of unpaid wages. If you believe that your employer has shortchanged your wages or has failed to pay the wages that you deserve to get, it is important that you contact an unpaid wages lawyer to understand your legal rights and options.
Key Points - Table of Contents
- Examples of Wage Theft
- Does My Employer Owe Me Money For Unpaid Wages?
- What Can You Do If Your Employer Doesn't Pay You In California?
- What is it Called When Employer Does Not Pay?
- Who Enforces The Law?
- What Remedies Are Available to Me?
- What is the Penalty For Unpaid Wages In California?
- How Do I File a Claim?
- Resources for Filing a Wage Claim
- Videos About the Wage Claim Process
- Gathering Case Facts
- What Documents Should I Include?
- Process to Receive Your Owed Wages
- What Are the Time Limits for Filing a Claim?
- How Much Can I Get for My Wage Claim?
- Private Cause of Action
- Contacting an Experienced Lawyer
Examples of Wage Theft
The following are some of the most common examples of wage theft in California:
Unpaid minimum wage: On January 1, 2020, California's statewide minimum wage increased to $13 per hour for employers with 26 or more employees and $12 per hour for employers with 25 or fewer employees. In the city and county of Los Angeles, as of July 2020, the minimum wage for employers with 26 or more employees was $15 per hour and $14.25 for those with 25 or fewer employees. If you are an employee in Los Angeles, you should be paid the higher minimum wage. However, some employers tend to shortchange their workers and not pay them the minimum wage that is due. This is one of the most common types of wage theft.
Not paying overtime: Both federal and California laws require nonexempt employees to be paid overtime wages when they work more than 40 non-overtime hours in a workweek. But, California law goes even further than federal overtime protections. In California, overtime must be paid when an employee works more than 8 hours in a workday, more than 40 hours in a workweek or a seventh consecutive day in any workweek. The usual overtime rate of pay is one and one-half the employee's regular rate of pay. However, the employee is entitled to double time when he or she works in excess of 12 hours in a workday or in excess of eight hours on the seventh consecutive workday in a workweek.
Not receiving rest and meal breaks: Under California law, employees who work more than five hours in a day are entitled to a 30-minute meal break. But, an employee may agree to waive that meal break if he or she will not work more than six hours in the day. In addition, employees who are working more than 10 hours in a day must also be given a second 30-minute break. Rest breaks and rest periods are also required under California labor regulations. The length of required rest periods must be at least 10 minutes for each four hours or a substantial fraction thereof that the employee will work in the day. Rest breaks must be counted as time worked and must be paid time. They must also be in the middle of the employee's work period.
Bounced paychecks: Under California Labor Code, if you deposit your paycheck and it bounces, your wages continue as a penalty until your employer makes good on the check. The penalties can add up for as much as 30 days and continue to accrue even if you are still working for the company.
Final paychecks not paid: California's employment laws state that departing employees are entitled to receive their final paycheck almost immediately. Employees who quit must get their final paycheck within 72 hours of giving notice that they're leaving. Employees who are fired must be paid on the same day that they are terminated. California final paycheck laws also require that the final paycheck include all wages and business expenses that the employee is owed. The final paycheck must also include the cash value of benefits owed to the employee such as accrued vacation time.
Non-reimbursed business expenses: In some cases, employers must also pay any business expenses incurred by the employee that have not been reimbursed such as travel, memberships to professional organizations, mileage, etc.
Unpaid sick leave: California law also requires employers to provide paid sick leave to employees. You are entitled to earn one hour of paid sick leave for every 30 hours worked. If your employer doesn't allow you to accrue or use paid sick leave, you are entitled to be paid for any time you had to take unpaid.
Does My Employer Owe Me Money For Unpaid Wages?
One of the big red flags that your employer may owe you money for unpaid wages is if the hours you worked and your paychecks are not adding up. It is important to ask a few questions here. Is your employer paying you the correct minimum wage? Are the hours you worked overtime missing from your paystub? Did your employer take tips or commissions you earned on the job? These are all signs that your employer may be stealing your wages.
If your paychecks do not accurately reflect your work hours or if your employer fails to provide you with a paystub, which is required under California law, the first step to take is ask them about it. Any time you meet with your employer or send them communication such as an email, document the date and time and write down what response you received from them.
If you don't get a response or if your employer refuses to pay you your wages due, it is time to contact an experienced California unpaid wages lawyer who can help you determine next steps. The one thing to understand is that your employer is required to pay you the wages you earned. Failing to do so is illegal. In such cases you can speak with an attorney to learn how to sue for lost wages.
What Can You Do If Your Employer Doesn't Pay You In California?
All employers in the state of California are required under the law to pay their employees the entire amount of wages owed for the time they have worked. Employers are also required to pay their workers in a timely manner.
California has strong protections for workers whereby the Labor Code spells out time lines regarding when and how employees must get paid. Employers in California are also prohibited from paying their employees late. Doing so could result in legal consequences including but not limited to monetary penalties.
If you did not get paid, the first step is to speak with your manager or supervisor. Alternatively, you could also approach the payroll department or human resources department, if your company has one.
Explain your issue in writing and document the response you received. If you did not receive the desired response, collect documentation to support your potential wage claim including your time sheets, work schedule, pay stubs, direct deposit information, company policies, etc.
It is always a good practice to keep track of your earnings and deductions. If communicating with your employer does not work, you may have to file a complaint with the Labor Department or a wage an hour lawsuit with the help of an experienced California employment lawyer.
What is it Called When Employer Does Not Pay?
When your employer does not pay the wages you earned, that is known as wage theft. Often, in California, tens of thousands of workers who are in minimum-wage jobs working in restaurants, car washes, farms, warehouses, nail salons and other industries, are the ones who are victims of wage theft – an unethical and illegal practice.
Wage theft occurs when employers deliberately pay workers below the minimum wage, deny them meal or rest breaks, fail to pay overtime wages or engage in other illicit practices to cheat or shortchange them.
According to CalMatters, in 2021, more than 19,000 workers filed claims with the state alleging wage theft totaling more than $338 million. You can also file a wage and hour lawsuit against your employer to collect damages including back pay. In some cases, when an employer owes a number of employees unpaid wages, a class action lawsuit might be the best course of action.
When workers have their wages withheld illegally, it has a tremendous impact on their finances leading to financial strain and emotional stress. Our unpaid wages lawyers can help you recover back pay as well as other compensation and help ensure that your employer is held accountable.
Who Enforces The Law?
The Wage & Hour Division of the U.S. Department of Labor enforces laws relating to unpaid wages. This type of enforcement is carried out by investigators located around the country who conduct investigations and gather data on wages, hours, and other employment practices to determine whether or not an employer has committed a violation.
When violations are discovered, these agencies may recommend changes in employment practices to bring an employer into compliance. It is a violation to terminate an employee for filing a complaint or for participating in a legal proceeding relating to the Fair Labor Standards Act (FLSA).
Employers who willfully violate these laws can face criminal prosecution and fines of up to $10,000 per violation. Sometimes, they could also face imprisonment.
In California, wage laws are found in the California Labor Code and the California Industrial Welfare Commission (IWC) Wage Orders, which provide for the overtime and minimum wage rates. The Division of Labor Standards Enforcement (DLSE) enforces these laws.
What Remedies Are Available to Me?
There are a number of ways under the FLSA for an employee to recover unpaid minimum and/or overtime wages. The Wage & Hour Division may supervise payment of back wages.
The Secretary of Labor may bring a lawsuit for back wages and an additional penalty called "liquidated" damages, which could essentially double the damages awarded to the employee. An employee also has the right to file a private lawsuit demanding back pay and an equal amount as liquidated damages in addition to attorney's fees and court costs. The Secretary of Labor may obtain an injunction to restrain an employer from violating FLSA including the illegal withholding of minimum wage or overtime pay.
What is the Penalty For Unpaid Wages In California?
Under California law, employers are required to not only pay their employers the correct wages, but also pay those wages on time. Depending on your employment contract or agreement, your employer may pay your wages by salary or at an hourly pay rate. Some employers pay employees daily or at the end of the month. However, most pay workers every two weeks.
If you are wondering if your employer can pay you late, it is important to know that California law prohibits delayed payments. When an employer fails to pay wages on time, they face stiff penalties and you have the right to take action to collect damages.
Penalties are essentially fines that the state imposes on an employer for violating labor laws. These fines are intended to punish employers and deter them from illegally withholding wages in the future.
One type of penalty is known as "back pay," which totals your unpaid hours times your hourly wages. If you receive a late paycheck, California Labor Code Section 210 requires your employers to pay a penalty of $100 for the first violation and $200 for subsequent violations in addition to 25% of the amount your employer illegally withheld.
If your employer's violation has affected an entire group of workers, you may consider initiating a claim under the California's Private Attorney General Act or PAGA, which allows workers in California to enforce a labor code on their own behalf or on behalf of other workers and the state of California. In such action, employees have the right to recover a portion of the penalties the state collects. An experienced California unpaid wages lawyer can help you determine what type of action is appropriate given you specific situation.
How Do I File a Claim?
To file a complaint for unpaid wages under the FLSA, employees may go either to the Wage & Hour Division, which may pursue a complaint on your behalf, or file your own lawsuit in court, which means you would need to retain the services of your attorney.
It is important that you contact the Wage & Hour Division as soon as possible. In California, in order to file your claim, you must complete an Initial Report or Claim (DLSE Form 1) and file it with the Department of Labor Standards Enforcement, which is a division of the California Department of Industrial Relations. The form will ask you to fill in information about you, your employer, your work schedule and what type of wages or penalties you are claiming.
Resources for Filing a Wage Claim
Here are a few valuable resources that can help you understand the process of filing a wage claim in California:
Videos About the Wage Claim Process
The Labor Commissioner's Office provides free instructional videos on the wage claim process. Videos are available for workers in all industries in English, Spanish, Chinese and Korean. A video for garment workers is available as well in English and Spanish.
Contact the Labor Commissioner's Office
For general information on the laws enforced by the Labor Commissioner's Office, you may visit their FAQ section. You may also call 833-LCO-INFO (833-526-4636) or visit the office near you. A list of office hours and locations can be found here. General questions could be directed via email to [email protected].
Minimum Wage in California
As of Jan. 1, 2023, the minimum wage in California is $15.50 for all employers. Some jurisdictions have higher minimum wage rates. If you work in one of these cities or counties, your employer is required to pay you the higher minimum wage. Here is more information about the minimum wage in California.
Industrial Welfare Commission Wage Orders
The 2021 minimum wage order and all current industry wage orders are listed here.
Exemptions from Overtime Laws
Here is a list of which employees are exempt from overtime laws.
Gathering Case Facts
When you file an unpaid wages claim, it is important that you gather facts, details and information that help substantiate your claim. Here is some of the crucial information that should be part of an unpaid wages claim:
Employer information: This includes the name and address of the company or individual for whom you work. You can find your employer's name on your paystubs, mailing labels or product labels.
If you cannot find the name, you can write down their vehicle plate number. If you have more than one employer or supervisor, you may need to list each of their names and vehicle license plate numbers.
Other responsible parties: Any individual acting as a supervisor or manager who violates labor laws can be held responsible in addition to the employer.
Hours worked: It is important that you track hours worked by writing down the time you begin and end work each day as well as when you take rest and meal breaks. Also, write down the total number of hours you work each day.
If you are paid by piece, keep track of the amount of time you spend on each piece so you can compare your total wages with the completed work. This helps ensure that you were paid for the work you did and that your pay prior to deductions equals at least the hourly minimum wage.
Paystubs: Under California law, your employer is required to provide you with a paystub each time you are paid. A paystub is a detailed, itemized wage statement, which should contain information including your name, wages earned, pay period, your employer's name, address and phone number as well as all taxes, deductions and hours of paid sick leave and vacation accrued.
All of these facts and documents will help you determine if you have been compensated properly for the work you have done, and will help support your case when you file a wage claim in California.
What Documents Should I Include?
The DLSE asks that workers filing a claim seeking unpaid wages include the following documentation in order to help them evaluate how much they are owed:
- Hours worked: Copies of any records that can show how many hours you worked should be included. Calendar entries or journal notes can be useful as can time cards filed with your employer.
- Paystubs: Copies of any paystubs or pay slips you received for the time period during which you are claiming unpaid wages.
- Bounced checks: You should include copies of any checks that bounced back due to insufficient funds.
- Notice to employee: A copy of this notice that your employer was required to give you at the time of hire. This document includes information about your employer including their legal name, address and your agreed-upon hourly rate of pay.
The DLSE will also ask your employer to provide the above documents. Your employment attorney can help you get copies of these documents as well. If you have additional documents such as an employment contract showing your employer's promise to pay to at a certain rate, you should include that as well.
Process to Receive Your Owed Wages
The U.S. Wage and Hour Division or WHD enforces the nation's labor laws. When violations are discovered, this department recovers unpaid wages on behalf of workers. While the agency does attempt to locate and notify employees who are owed back wages, it will hold the back wages for three years if unable to locate the employee.
If you believe you are owed back wages collected by WHD, here is the step-by-step process to receive the wages you are owed:
1. Find your employer.
Access the Workers Owed Wages application on WHD's website. This is also known as the WOW application. On this application, search for our company and select it.
2. Find yourself in the system.
When you enter your name, the application will be able to locate you and confirm that you have wages owed to you.
3. Fill out your contact information.
Make sure you fill out your contact information accurately so the agency can send you your Back Wage Claim Form and the accompanying instructions
4. Upload the signed claim form.
Once you receive the Back Wage Claim Form via email, fill it out, sign it and follow the instructions to create a login.gov account. Once that is done, upload your form and all supporting documents including:
- Copy of your Social Security card
- Copy of your Individual Taxpayer Identification Card (ITIN)
- Copy of your driver's license or state identification card
- W-2
- Pay stub
- Any additional supporting documentation verifying your identity
5. Processing and sending your owed wages.
Once you send it your Back Wage Claim Form, it will take WHD six weeks to process it and send you a check for your owed wages.
What Are the Time Limits for Filing a Claim?
There are strict time limits within which an unpaid wages claim must be filed. You must file a lawsuit in court within two years of the violation for which you are claiming back wages, except in the case of an employer's willful violation, in which case a three-year statute applies.
It is best not to wait to file your claim. Don't cut it too close. It may also be helpful to consult with an attorney before you file your claim. The "statute of limitations" for California wage and hour lawsuits is three years from the date when the most recent violation has occurred.
How Much Can I Get for My Wage Claim?
Under California law, if your employer failed to pay you at least the minimum wage, you are entitled to the difference between that what you actually received as payment for each hour that you worked. For example, if your employer in Los Angeles paid you $13 (California minimum wage rate) as opposed to $15 (Los Angeles minimum wage rate), you are entitled to $2 for every hour worked.
If your employer did not pay you overtime, you can get an extra 50% of your regular wages for each overtime hour worked. You are also entitled to payment for any business expenses for which your employer failed to reimburse you. In addition, you can also get any unauthorized deductions your employer made from your paycheck and any tips or commissions that were withheld.
Under California law, you can also collect a variety of penalties for certain types of wage violations such as failing to provide meal and rest breaks, failing to provide proper paystubs, and not providing a final paycheck on time.
Private Cause of Action
Sometimes, rather than going through a state agency, an employee may choose to pursue a private cause of action against the employer. In such cases, an employee may discuss the case with an employment lawyer who can advise him or her about the advantages with a private cause of action such as the potential for higher awards or quicker case resolution. You may also be able to file an unpaid wages claim in small claims court if the amount in question does not exceed $5,000.
Under California law, workers cannot be fired for exercising their rights and filing an unpaid wages lawsuit. An employer is prohibited from taking retaliatory action including termination against an employee for bringing up wage and hour violations or for filing an unpaid wages lawsuit.
Firing an employee for filing an unpaid wage claim is considered "wrongful termination." If your employer retaliated against you for bring a wage and hour lawsuit, you may have additional cause of action against your employer.
In some cases, where a number of workers have been denied fair wages, a group of individuals can band together as a class and sue the employer seeking damages. The advantage of a class action lawsuit is that the attorney can devote more time and resources to the case.
Contacting an Experienced Lawyer
Not being paid the wages you are due can cause serious financial hardships. There are several federal and state laws that protect employees from being exploited in this manner. If you believe your California employer has shortchanged your wages or has failed to pay you fair wages for work done, it is important that you contact an experienced Los Angeles wage and hour attorney who can fight on your behalf and help you receive compensation for your losses.
The knowledgeable employment attorneys at Kingsley Szamet & Ly Employment Lawyers represent our clients on a contingency fee basis, which means that you do not pay any fees unless you win or recover compensation, and you will never have to pay out of pocket. Call us at 888-209-8927 for a free initial consultation.