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Corporate Employers Face Personal Liability for Wage Theft Under California Fair Day's Pay Act

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“Integrity is telling myself the truth. And honesty is telling the truth to other people.” Spencer Johnson

Wage and Hour Attorney California Worker Lawyer

Special Protections Under California’s “A Fair Day’s Pay Act”

In the past, California workers who were not receiving fair pay for their work had two options: report their employers to the Labor Commissioner or file a lawsuit against the company. But now, employees will now enjoy one more protection against stolen wages: they can hold individuals within a company personally liable for wage theft.

The California Labor Code guarantees certain rights to workers, such as minimum wage, overtime, and meal and rest break requirements. The Labor Code also allows employees to take private action against employers for wage and hour violations, but until now, employees could only name the company as a whole in the lawsuit.

“A Fair Day’s Pay Act,” which took effect on January 1, 2016, under section 588.1 of the California Labor Code, allows high-ranking corporate individuals to be named in wage and hour actions. Employers can take direct action against owners, directors, managing officers, supervisors, payroll officials, and any other employees who have the authority to perform employee wage transactions.

Section 588.1 also grants additional protection to California workers by allowing the Labor Commissioner to:

  • Investigate the actions of individuals and hold hearings to determine individual liability
  • Act as a creditor to enforce proper payment to an employee after a successful wage claim
  • Place liens and seize property of individual corporate owners or managers in order to pay judgements
  • Post a bond against employers who have not paid court-ordered settlements to employees (ranging from $50,000 to $150,000) which must be paid before the employer can continue to do business within the state
  • Enforce penalties for each wage and hour offense that continues after the judgement
  • Hold successors and successive business responsible for judgement debts, to prevent employers from changing the names or internal structures of a business to limit the amount of money that can be paid in a settlement

Do you know your rights under the California Labor Code? Read through a copy of our free guide, The Ultimate Straight Talk Guide To Getting Your Hard Earned Wages Back, to find out how much you could be owed in overtime and back wages.

William Turley
“When I seek out professional advice, I don’t want B.S., I want it straight up. I figure you do also.”
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