A Minimum Wage and Overtime Recovery For Three Times Amount Claimed
California was among the first states to require a minimum hourly wage, 16 cents in 1916. Federal law finally joined the trend in 1938. Now, cities and counties are enacting ordinances for ever-higher minimums. See, The History of Minimum Wage Laws, and Location, Location, Location…Location (July, 2017). Increasing overtime requirements go hand in hand. See, A Super-Sized McDonald’s Overtime Class Action Ruling (April, 2017).
Part of a series, a California Labor Commissioner press release last month made an example of a Yuba County convenience store owner ordered to pay a former clerk over $42,000 in back minimum wage and overtime pay, nearly three times that employee’s written claim.
The Commissioner hearing officer found Mike’s Food & Liquor was incorrectly paying this hourly worker a set salary for a presumed 80 hours-worth of labor twice a month. The hearing officer also rejected the employer’s claim that it did not have complete time records because the employee had stolen them, ruling that if the “employer’s records are inadequate, inaccurate or nonexistent . . . [t]he solution is not to penalize” the employee. Instead, the Labor Commissioner may approximate the amount that is owed. Thus, on the clerk’s plausible descriptions, the hearing officer approximated an average of 62.2 average weekly working hours, or 8.9 average hours daily/seven days a week.
California is one of the few states requiring payment for weekly or daily overtime, including 1.5x regular rate for daily hours after eight; 2x for hours after 12; 1.5x for the first eight hours on a 7th day of work in a week; and 2x for hours after eight on that 7th day. See, Working Overtime in California.
While the claimant had sought a relatively modest $14,520 in back wages, the hearing officer used the 8.9 daily average to award $22,162 in regular wages as well as 1.5x and double time, plus another $20,728 in “liquidated damages,” interest and penalties, a $42,980 total. When the employer failed to pay, the Commissioner went to court and eventually recovered $48,860, including additional interest.
The June 27, 2017 release is part of a campaign condemning wage violations in criminal terms. The notice quotes Labor Commissioner Julie Su: “Workers [who] are not paid correctly are victims of wage theft and my office can help get them back what they have earned. This case shows that when workers exercise their labor rights and come forward to report wage theft, they can do so on their own time without an attorney, they can receive the wages they are owed, and in some cases even more.”
The lessons are obvious. First, employers are responsible for paying each hourly worker at least the applicable minimum wage and any accompanying overtime compensation. Second, in order to calculate (and later confirm as needed) the proper wage amounts, employers must preserve complete and reliable records of employee hours worked.
If you need assistance to determine how to pay employees correctly, please contact one of our attorneys Tim Bowles, Cindy Bamforth or Helena Kobrin.
Helena Kobrin,
July 28, 2017