California Labor Commissioner Recovers $282,000 for Wage Citations
California Labor Commissioner Recovers $282,000 for Wage Citations
New lien authority assists in recovery of money for employees not paid for all time worked
The Labor Commissioner’s Office recovered more than $282,000 for wage theft violations affecting 22 car wash workers in Long Beach, who were not paid for the time they were on premises, in some cases up to three hours a day. The workers were not paid overtime or minimum wages.
An investigation into Classic Castle Car Wash, Inc., which operates Klassic Car Wash & Detail Center and Castle Carwash in Long Beach, found that some workers were forced to wait up to three hours before clocking in, while others were only paid for hours when they performed car wash duties and were asked to remain onsite without pay when it wasn’t busy.
The $282,000 recovered will pay workers approximately $229,000 for the overtime and minimum wages, liquidated damages and waiting time penalties owed; $53,000 in civil penalties will go to the state. The monies were secured after a lien on real property was filed by the Labor Commissioner’s Office on Classic Castle Car Wash, Inc.
“The new lien authority provides a practical tool to recover owed wages,” said Labor Commissioner Lilia García-Brower. “It has simplified and expedited the process to get into the pockets of workers and their families the money that is rightfully theirs. These courageous workers reported the wage theft and kept us informed of actions by the car wash owners, which ensured we could ultimately hold the employer accountable and ensure they received their stolen wages.”
In 2021, SB 572 (Hertzberg), the “enforcement lien” bill added Labor Code 90.8, which went into effect in January 2022. It authorized the Labor Commissioner to create, as an alternative to a judgment lien, a lien on real property to secure amounts due under any final citation, findings or decision. The bill requires the Labor Commissioner to include specified information on the certificate of lien to be recorded on the relevant party’s real property and to issue a certificate of release once the amount due, including any interest and costs, has been paid.
The Labor Commissioner’s Office opened its investigation into Classic Castle Car Wash, Inc. in 2017 after receiving a referral from the CLEAN Car Wash Campaign. The citations issued in 2017 for wage theft violations totaled $370,644. Classic Castle Car Wash, Inc. appealed the citations, and a notice of finding issued by the hearing officer amended the total citations due to $241,641 on December 4, 2020. Classic Castle Car Wash, Inc. made payments on the citation totaling $54,272.93 from 2017 to 2020 but eventually stopped making payments.
After a judgment was entered for the case at the end of 2021, workers learned that the business was going to be sold and reported this to the CLEAN Carwash Worker Center, which informed the Labor Commissioner’s Office. On June 17, 2022, the Labor Commissioner’s Office recorded a certificate of lien after the enforcement lien bill went into effect in 2022. Classic Castle Car Wash, Inc. had been named in the citations, so the Labor Commissioner’s Office was able to file a lien on the owner’s real property to ensure workers were paid.
One month later, the Labor Commissioner received payment on the Classic Castle Car Wash citations.
Enforcement investigations typically include a payroll audit of the previous three years to determine minimum wage, overtime and other labor law violations, and to calculate payments owed and penalties due.
So, if you receive a visit from or an audit letter from the Department of Industrial Relations’ Division of Labor Standards Enforcement (California Labor Commissioner’s Office), it may be because of an investigation by the Labor Commissioner to “combat wage theft and unfair competition,” and “illegal and unfair business practices”. The Labor Commissioner’s Office in 2020 launched an interdisciplinary outreach campaign, “Reaching Every Californian.” The campaign amplifies “basic protections and builds pathways to affected populations so workers and employers understand legal protections and obligations, and the Labor Commissioner’s enforcement procedures.”
We very much expect that there will be an increasing number of cases and investigations by The Labor Commissioner. Reviewing employee categories, wages, payments and policies before an audit by the Labor Commissioner is key to avoiding business interruptions. We’re on it for you here at Epps and Coulson, LLP. We work to remain up to date with the changes to the laws as they occur. We can help you – please contact dawn at: dcoulson@eppscoulson.com
Information contained in this Memo is intended for informational and educational purposes only and does not constitute legal advice or opinion, nor is it a substitute for the professional judgment of an attorney. It is likely considered advertising. Epps & Coulson, LLP encourages you to call to discuss these matters as they apply to you or your business.
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