The "Wage Theft Prevention Act of 2011," AB 469, creates new, detailed disclosure requirements that must be provided to all new non-exempt employees commencing January 1, 2012. This statute also creates document retention requirements and imposes several new penalties for violations of wage laws.
Newly added Labor Code Section 2810.5 requires employers to provide written notice upon hire to each non-exempt employee of the employee's rates of pay (including overtime compensation rates), the basis for the pay (hour, shift, day, week, salary, etc.), any allowances claimed as part of the employee's wages (including meal or lodging allowances), the regular payday designated by the employer, the employer's name (including dba names), the physical address of the employer's main office or principal place of business, and a mailing address, if different. The Labor Commissioner will be providing a template for employers to follow. Section 2810.5 also requires employers to notify non-exempt employees of any changes to that information within seven days of change, unless the information is reflected in written wage statements required by Labor Code Section 226 or in some other writing required by law within the seven-day time period. This provision is similar to one enacted in New York in 2009. The notice requirement does not apply to employees who are exempt for overtime purposes or to employees who are covered by a collective bargaining agreement that provides a regular hourly rate of pay not less than 130 percent of the state minimum wage.
The new law also amends the Labor Code 1197.1 to specify that employers who violate the minimum wage law are liable for restitution of wages paid to the affected employee, in addition to civil penalties. It also makes it a misdemeanor to willfully violate wage statutes or orders or to willfully fail to pay a court judgment or final order of the Labor Commission for wages due.
In addition to these penalties, the Wage Theft Prevention Act extends the period of time in which the DLSE may commence a collection action for a statutory penalty or fee to three years. If the Labor Commissioner requires a convicted employer to maintain a bond, the new law extends the time required for the bond to two years, and it permits the Labor Commissioner to require an employer to provide an accounting of assets if the employer does not timely post the bond. Failure to provide the accounting may result in a penalty of up to $10,000. The new law also authorizes employees to recover attorneys' fees and costs they incur to enforce a judgment for unpaid wages.
Finally, the Wage Theft Prevention Act amends Labor Code Section 1174 to increase the amount of time employers must maintain payroll records from two to three years. It also specifies that employers may not prohibit employees from maintaining a personal record of hours worked or piece-rate units earned.
