Will 2016 Be the Year More Employees Recover Their Unpaid Wages?

Senate Bill 588, which went into effect in California on January 1, 2016, has not been in the media spotlight, but it should be.  It will provide a much-needed enforcement mechanism to tackle rampant wage theft throughout this state.  

The Department of Labor Standards Enforcement (DLSE), also frequently referred to as the Labor Commissioner, is responsible for enforcing the wage laws in California.  Thousands of employees across the state file claims each year with the DLSE for wage theft, including to recover minimum wages and overtime pay.  

While the DLSE is a forum for individuals, including many who do not have legal representation, to assert their rights to earned wages, all too frequently a triumphant employee leaves empty handed.  A study conducted by the National Employment Law Center and the UCLA Labor Center found the following:

Only 17 percent of California workers who prevailed in their wage claims before the DLSE and received a judgment were able to recover any payment at all between 2008 and 2011.

This is outrageous, but unfortunately not too surprising.  Most employers who are found to owe wages before the DLSE simply close up shop, move, or dissolve their business, leaving the DLSE and employees with little recourse.  SB 588 changes this. Now, under the new law, once a judgment is entered against an employer, the DLSE will have the ability to attach a lien to an employer’s bank accounts, business property, and even personal property.  Other states that have enacted similar enforcement laws have seen an increase in successful wage recoveries.  While California must do more to enforce wage laws, including increasing funding to state collections agencies, this is a step in the right direction.