California Penal Code section 487m criminalizes intentional Labor Code violations  – such as failing to timely pay all required wages (e.g., minimum wage, overtime, premium pay for missed breaks), requiring off-the-clock work, or taking workers’ tips — as felony grand theft if the underpaid wages exceed $950. For this section, “employee” includes an independent contractor and “employer” includes the hiring entity of an independent contractor. Conviction can result in a jail sentence of up to three years.

On February 16, 2024, the California Department of Industrial Relations (DIR) launched an $18 million Workers’ Rights Enforcement Grant Program (the Grant Program) for local prosecutors to aggressively pursue employers who violate labor laws.

Labor Commissioner Lilia Garcia-Brower stated: “We appreciate the legislature’s support in creating this funding source to incentivize the prosecution of wage theft.  This is a serious and persistent problem, which demands increased collaboration with government agencies and community leaders.  This grant program will help further our efforts to combat wage theft and unfair competition in the workplace.  We look forward to working with local prosecutors in addressing these important issues.”

Take-Aways:

The Grant Program underscores the importance for all California employers to know and apply proper pay practices.  Our firm can help with friendly, confidential wage audits, ranging from a small targeted sampling of pay records to extensive review of workplace wage-and-hour practices.

For further information, please contact Tim Bowles, Cindy Bamforth or Helena Kobrin.

See also:

• We Offer an Ounce of Prevention; Make Wage Audit a Priority (February 15, 2024)
• $5.5M To Settle Wage Theft Claim — Elderly Care Provider Fought Underpayment Citation for Five Years (January 5, 2024)
• PAGA Monster Grows More Legs – Best Protection Against Potentially Devastating Group Labor Claim is …Prevention (February 2, 2024)

Cindy Bamforth
March 8, 2024