Employment Law

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Employment - Unpaid Wages

STATE AND FEDERAL LAWS PROTECT AN EMPLOYEE'S RIGHT TO WAGES

Both state and federal laws ensure that employees are fairly compensated for their servies.  Federal law is codified in the Fair Labor Standards Act ("FLSA") [29 USC 201-219] and regulations interpreting the FLSA.  California law is codifid in the Labor Code and in Wage Orders promulgated by the Industrial Welfare Commission.  Although California law is generally more protective, California employers must comply with whichever laws provide greater protections to employees.

Labor Code 1194 provides a private right to sue for unpaid minimum wages or overtime compensation.  "Wages includes all amounts for labor performed by employees of ever description, whether the amount is fixed or ascertained by the standard of time, task, piece, commission basis, or other method of calculation."  (Labor Code 200(a).)  "[A]n employee's 'wages' or 'earnings' are the amount the employer has offered or promised to pay, or has paid pursuant to such offer or promise, as compensation for that employee's labor."  (Prachasaisoradej v. Ralphs Grocery Co., Inc. (2007) 42 Cal.4th 217, 228.)

Wages includes all benefits to which an employee is entitled as a part of his or her compensation, including:

• Money;
• Vacation pay;
• Bonus and profit-sharing plans;
• Employer contributions to a health plan;
• Payment of premiums on group term insurance;
• Payments to an unemployment insurance fund;
• Severance pay;
• Employer provided uniforms; and
• Restricted stock or stock options. 

AVAILABLE REMEDIES TO AN EMPLOYEE WHO FAILED TO RECEIVE ALL WAGES

Remedies for an employee who failed to receive all wages include:

• Payment of all wages due and owing:
• Under federal law, liquidated damages of up to double the amount due;
• Under California law, waiting time penalties roughly equal to one month's wages;
• Reasonable attorney fees and costs of litigation.

FACTORS THAT CAN STRENGTHEN YOUR CASE FOR UNPAID WAGES

In our experience, the following factors can strengthen (or weaken) a person's case for unpaid wages:

• The willingness of eyewitnesses to provide a signed statement supporting your case. For example, if another former employee is willing to sign a statement under penalty of perjury that he/she was present on days when you worked from 6 a.m. to 5 p.m., that can be strong evidence to support your claim for unpaid wages;
• Your possession of time sheets, pay stubs, the employee handbook, and other employment-related documents;
• Prior acts of dishonesty. For instance, if you were dismissed from college for cheating on an exam, that could substantially impair your credibility and weaken your case.

We EMPHASIZE that all cases involve unique sets of facts and circumstances, and you should feel free to call us for a free case evaluation NO MATTER if any or none of the above factors apply to you.