Recently, the Labor Commissioner’s Office issued wage theft citations to Vista Santa Rosa, Inc., a large Riverside County farm labor contractor, for failing to provide 1,374 seasonal farmworkers their final pay at time of discharge. The violations came to light after a 2016 Division of Labor Standards Enforcement (“DLSE”) investigation, spurred by worker complaints to labor watchdog California Rural Legal Assistance. The DLSE found the employer consistently issued final payments at least 3 days late.
The California Labor Code requires employers to pay all wages due to a worker at the time of separation. When a worker quits without two weeks’ notice, payment is due within 72 hours. Under California law, late payments are considered wage theft. According to Labor Commissioner Julie A. Su, late payments place “significant pressure on seasonal workers to abandon their pay or wait and jeopardize competitive job and lodging openings.”
To curb the unlawful practice, the Labor Code imposes “waiting time penalties” on employers who intentionally fail to pay their workers on time. Penalties are calculated by multiplying the worker’s daily rate of pay by the number of days that have elapsed since the final payment was due. Penalties are capped at 30 days per worker.
The DLSE assessed $323,729 in waiting time penalties against Vista Santa Rosa, Inc., for 2016 and an additional $323,145 for 2017 for a total of $646,875 owed to 1,374 employees. Not only is Vista Santa Rosa, Inc., liable for these violations, but their eight client employers that used these workers are also responsible under California Labor Code section 2810.3. The Labor Commissioner is hopeful that “bringing attention to this issue during the grape harvest should deter farm labor contractors and growers from this wage theft practice and held ensure their workers are paid on time.”
COUNSEL TO MANAGEMENT:
Waiting time penalties are not only a concern for farm labor contractors but also client employers. Often times, as was the case here, client employers obtain seasonal workers from farm labor contractors to meet their fluctuating employment needs. When doing so, client employers need to be weary of the farm labor contractor’s payment practices as California Labor Code section 2810.3 holds both parties liable waiting time penalties.
When the DLSE conducts an investigation, the agency typically audits the alleged offender’s payroll for the previous three years to identify minimum wage, overtime, and labor law violations, as well as payments owed. As illustrated by the instant case, penalties can be hefty for the farm labor contractor and the unknowing client employer. If you are a farm labor contractor concerned about compliance with final pay laws, or a client employer concerned about the practices of your labor supplier, contact the experts at The Saqui Law Group.