The Court has extended the July 1, 2016 cut-off for signing up to make AB 1513
By Kevin Cleveland
On June 30, 2016, in Nisei Farmers League v. CA Labor and Workforce Development Agency et. al, the Court granted a temporary restraining order temporarily preventing the enforcement of the July 1, 2016 AB 1513 (CA Labor Code section 226.2) sign-up deadline. As a result, the time to sign up to make payments under AB 1513 and receive the safe harbor it provides has been extended until at least July 28, 2016. A hearing has been set for July 18, 2016 to determine if the entire enforcement of AB 1513 will be halted while the Nisei Farmers League prosecutes their case against the State to have AB 1513 declared unconstitutional. The lawsuit, in effect, claims that the law is too vague to be enforceable, provides inadequate description of what is required to comply with the law, is unlawful because the piece rate systems under which employers were paying employees were not contrary to the then existing law, that the law improperly interferes with contracts, functions as retroactive punishment, and constitutes an unlawful taking of property.
COUNSEL TO MANAGEMENT:
If your company is planning on making AB 1513 payments it would be wise to continue to prepare to make such payments. The Court will decide whether it will stop enforcement of AB 1513 altogether while this legal challenge proceeds or whether it will allow AB 1513 to proceed according to plan on July 18, 2016. At that time we will issue an additional advisory. Your company should consult with its legal counsel regarding what if any effect this decision has on your plans to make payments under AB 1513 if you are already signed up. If you are not signed up to make payments but would like to participate in AB 1513, you have until at least July 28, 2016 to sign-up.