Every day, employees in California work hard to earn their living, and the state laws stand as a steadfast protector of their right to be paid promptly. But what happens when this fundamental right is overlooked or ignored by employers? Given the bustling economy of California, timely payment of wages is not just an expectation; it is a legal mandate. This article explains the legal consequences and remedies for late employee payments and the avenues available to employees for seeking justice.
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When Should California Employees Be Paid?
California law firmly mandates that employers not only pay their employees’ wages but also do so on time. This legal requirement ensures workers’ financial needs and rights are respected and upheld.
Employers are legally bound to pay earned wages on predetermined paydays. Any deviation from this can lead to legal repercussions, emphasizing the critical nature of adhering to scheduled payment dates.
When Must My Employer Give Me My Final Paycheck?
California’s stringent labor laws mandate the prompt payment of final wages to departing employees, whether they quit or are terminated.
Fired employees must receive their final wages on the same day as their termination. Those who quit are entitled to their final paycheck within 72 hours of giving notice. This requirement underscores the state’s commitment to ensuring workers are not stranded financially during employment transitions.
Late Paycheck Damages
In California, delayed wage payments are met with stringent measures to ensure employers comply with timely wage distribution laws. One of the key mechanisms for enforcing this is “waiting time penalties.”
Under California Labor Code 210, under AB 673, employers incur waiting time penalties when they fail to provide the final paycheck on time. These penalties amount to a full day’s wages for each day the final payment is delayed. This accumulation continues until the payment is made or reaches a maximum of 30 days.
What Happens If My Employer Is Late With My Paycheck?
CLC 210 punishes employers who delay the issuance of paychecks. In such cases, seeking advice from a California employee law attorney can be invaluable. Employment attorneys can help maneuver labor laws, ensuring employees’ rights are upheld and violations appropriately addressed.
Employer Financial Penalties for Late Paychecks
These penalties are structured to be progressively severe, reflecting the seriousness with which the state views timely wage payments. When an employer fails to pay wages on time for the first time, they face a penalty of $100 for each affected employee. This initial fine serves as a warning and a deterrent against future delays.
If the wage payment delay is intentional or the employer has previously violated these terms, the penalty escalates significantly. In such cases, the employer must pay $200 for each employee whose payment was delayed, plus 25% of the amount unlawfully withheld.
Waiting Time Penalties Paid to Employees for Late Final Wages
Waiting time penalties are calculated based on the employee’s daily wage rate and accrue for each day the final wages are delayed. This daily wage rate is determined by considering the employee’s base wages, commissions, bonuses, and vacation pay, annualized, and then divided by the number of work weeks and hours. The penalty continues to accumulate daily but is capped at a maximum of 30 days from the due date of the final paycheck.
Employee Damages for Late or Incomplete Paychecks
The California law enforces a “waiting time penalty” for employers who willfully fail to pay final wages in full and on time after employment ends. The penalty consists of a full day of wages for each day the payment is delayed, continuing to accrue for up to 30 days after discharge, depending on when the payment is fully satisfied. The employee’s daily wage rate, which includes base wages, commissions, bonuses, and vacation pay, is used to calculate this penalty, divided by the number of work weeks and hours.
When an employer fails to pay wages in full or on time, but the employee continues working, the waiting time penalty does not apply. Instead, the employer may be liable for statutory fines, which are:
- First Violation – $100 for each failure to pay each employee.
- Subsequent Violations – $200 for each failure to pay each employee, plus 25% of the amount unlawfully withheld.
These penalties are generally payable to the State of California. However, an employee can sometimes recover up to 25% of the penalty by filing a lawsuit under the Private Attorneys General Act (PAGA).
Employees encountering late or unpaid wage issues are encouraged to seek legal counsel to protect their rights. If you are facing such issues, do not hesitate to consult with an employment attorney to explore your legal options and claim what you are rightfully owed.