A California jury returned a verdict in favor of Dollar Tree Stores, Inc. last week, finding that the discount retailer’s practice of printing employee paystubs on cash register receipts did not violate California law requiring employers to provide accurate wage statements to employees. Guillen v. Dollar Tree Stores Inc., case number 2:15-cv-03813, (U.S. District Court for the Central District of California).
In the class action suit, named Plaintiff, Francisca Guillen, claimed that she did not receive an itemized wage statement each pay period because Dollar Tree did not provide its 5,400 employees traditional wage statements or access to online wage statements, but required employees to print their statements from store cash registers. By contrast, Dollar Tree’s corporate employees are able to access their wage statements online from the company’s website. Dollar Tree argued that the practice was meant to provide convenient access to wage statements for store employees who may not have access to the internet or a printer at home. Furthermore, the wage statements printed by employees on cash register receipts included all information required under California law.
The Guillen decision highlights an ongoing trend of employers phasing out traditional paper wage statements in favor of electronic wage statements as more employees are paid via direct deposit or pay cards, rather than paper check.
No matter the form, wage statements provided to California employees must contain the following nine pieces of information required by Labor Code section 226(a):
(1) Gross wages earned;
(2) Total hours worked;
(3) The number of piece-rate units earned and any applicable piece rate;
(4) All deductions;
(5) Net wages earned;
(6) The inclusive dates of the period for which the employee is paid;
(7) The employee’s name and the last four digits of his or her social security number or an employee identification number;
(8) The name and address of the employer; and
(9) All hourly rates and the number of hours worked at each rate.
With the passage of mandatory sick leave laws, California employers must also include available sick time on the wage statement or on a separate writing provided at the time of pay. Labor Code § 246.
The Department of Labor Standards Enforcement has approved the use of electronic wage statements so long as the following conditions are satisfied:
(1) The employee is able to easily access the electronic wage statements and convert the electronic statements into hard copies at no additional expense;
(2) The electronic wage statement system provides adequate safeguards for ensuring the confidentiality of employee information;
(3) The Employer retains records of the wage statements for a period of at least three years; and
(4) The employee retains the right to receive a paper wage statement upon request.
DLSE Opinion Letter No. 2006.07.06 (July 6, 2006); Derum v. Saks & Co. (S.D. Cal. 2015) 95 F. Supp.3d 1221, 1226.
Technical and strict compliance with California’s exacting wage statement requirements is necessary to avoid potentially stiff penalties and costly class action litigation. Employers that fail to provide accurate wage statements face statutory penalties of up to $4,000 per employee, plus additional civil penalties imposed on a pay period basis. Employers should revisit their wage statements to ensure strict compliance with the Labor Code.