CALIFORNIA LABOR COMMISSION

INTRODUCTION

The California Labor Commission has earned itself a reputation for being pro-employee, which is more evident in its wage-claim proceedings. Also known as the Division of Labor Standards Enforcement (DLSE), the labor commission is committed to encouraging economic justice through robust enforcement of labor laws in the State and ensuring fair pay in every workplace. By protecting the entire California workers, including the illegal or undocumented immigrants from retribution, combating wage theft, and sensitizing the public, the California labor commissioner’s office has put earned wages into employee’s pockets and helps to level the playing ground for law-abiding employers.

This article provides a brief explanation of what the California labor commission can do, their role in adjudicating employment claims, a brief description of what to expect in the proceedings, and practical tips for employers looking to defend wage claims.

LIMITATIONS TO WHAT THE CALIFORNIA LABOR COMMISSIONER CAN DO

Subject to the labor Code Section 98(a), the office of the California labor commission can only attend to disputes towards recovering wages and hours, and other compensation claims. The California labor commission CANNOT give a ruling on any other types of employment and non-employment claims, such as discrimination, battery, assault, retaliation, wrongful termination, harassment, personal injury, etc. Similarly, an employer that has a counter-claim against the worker cannot be heard by the Labor Commissioner but must be filed in court. But if your employer owes you, you can file a complaint at the labor commissioner’s office and have your case heard by a judge appointed by the California Labor Commissioner. The judge is allowed to issue a judgment against your employer and award your unpaid wages and interest, attorney fees if obtainable, and certain penalties. 

YOUR ENTITLEMENT AS AN EMPLOYEE UNDER THE CALIFORNIA LABOR LAW

According to Labor Code 512, employers are required to give non-exempt workers in California the following wage rights among many others:

• Rest Breaks – a 10-minute paid rest break for employees that work more than 3.5 hours per day, and a second 10-minute paid rest break for employees that work more than 6 hours per day.
• Lunch Break – a 30-minute uninterrupted lunch break after every five hours of work. The break must start no later than the end of the fifth hour of the employee’s shift.
• Overtime – 150% (1½) times the employee’s regular pay for any hours they work more than 8 hours in a workday, 40-hour workweek, or hours worked on the seventh consecutive day in a workweek.
• Last Paycheck – You are entitled to receive your last paycheck upon termination or on your last day of work. If you quit, you are entitled to receive your final wages within 72 hours after your last day of work. Your last paycheck must comprise any unpaid vacation pay but not sick leave pay.

FILING A WAGE CLAIM IN CALIFORNIA

If your employer denied you any of your work entitlements, regardless of the amount, you have the right to file a complaint. California labor law provides employees with two options in regard to making an employment claim against your employer. It is either you:

1. File a claim with the office of the California labor commissioner or
2. File a claim in the superior court.

As an employee, which one makes the most sense to you? The answer is dependent on your situation. The California labor commission may seem like the best choice in the first place. It enforces California wage and hours laws via a simplified and speedy administrative procedure that can initiate a swift resolution of your case, though not essentially one that maximizes the value of your case. It is less expensive and offers a much faster option than going to court. The benefits are relatively less if the law is not properly considered.

Generally, workers who sue with the office of the Labor Commissioner may not do well as those who file a suit directly in a superior court. You will likely not be able to compel a witness to testify or compel your employer to produce documents, which may be required to prove your case or to invalidate any of your employer’s claims. 

A significant disadvantage of filing a claim with the office of the California labor commission is that they do not look back beyond three years from the date of filing your claim. This implies you cannot recover any damages after these three years. In court, however, you can consider even four years from the date of filing your claim.

Likewise, most people who act as the judge in these types of hearings may be a novice to the law. They are actually not required to be lawyers, and the fact is most of them are not. In complex cases, the subtleties of wage and hour law are utterly overlooked. It is, however, essential to note that most of the California labor commissioners are actually knowledgeable, and the lack of practical rules often work to the advantage of the employee. 

If your case is minor (or in more significant cases where there are no other valuable wage claims) and you want to prevent any nuance in the law, then filing a claim with the California labor commission may make sense. Theoretically, the procedure of the office of the labor commission is easy and designed to allow you to represent yourself. But in the real sense, you may need to hire an employment law attorney on any substantial claim to get you prepared for the hearing and be able to maximize your possible claim. I would suggest you consult with a lawyer before deciding to file a claim with the California Labor Commission.

EMPLOYER: REACTING TO A COMPLAINT NOTICE FILE AGAINST YOU AT THE LABOR COMMISSION

If you received a complaint notice through the office of the California Labor Commissioner, you need to understand your rights, what to expect at the proceedings, and how to prepare before taking any action. As an employer, note that the process can seem discouraging. However, it can be managed efficiently with a little preparation. Outlined below are the basic steps that most California Labor Commissioner Proceedings follow

1. Claim Notice

As an employer, you are mostly aware of a complaint to the office of the California Labor Commission when you receive a “Notice of Claim and Conference.” An employer or their representative is not expected to file any document in response to the notice of the conference, but they are mandated to appear at the proceedings on the date and time indicated on the notice. The conference is actually not for proceedings on the matter, but as a non-binding resolution conference during which the Labor Commissioner talks about the various claims against the employer and will try to reconcile the parties.

2. Preparing for the resolution conference

Employers must evaluate the document they received from the office of the Labor Commissioner to ensure they collect and bring the necessary documents along to the conference. They should analyze the worker’s claims in the notice and prepare a defense outline that supports their position. The California labor commissioner usually requires the employer to provide, among many others:

• Any paperwork that is relevant to the worker’s claims, like timesheets, payroll records, handbook and applicable policies, correspondence with the worker and others
• Articles of information filed with the Secretary of State

The California labor commission does not require both the employer and the employee to hire a lawyer at any stage of the proceedings. Whether an employer chooses to have legal representation during the proceedings is dependent on how comfortable the employer is with managing the issues and how well they know the law to be able to express the right defenses available to them.

3. At the settlement conference

The office of the California Labor Commissioner will often arrange the case for an initial settlement conference, even though it is not compulsory. This step is not the actual hearing on the matter wherein the Labor Commissioner allows sworn testimony and determines who should prevail. All the same, the employer should prepare documents and evidence that will persuasively establish their defense against the employee’s allegations. This stage is important because you will be able to hear facts from the employee about their claims, what evidence they may have, and who may be their witness. With this information at hand, you will be able to prepare for a formal hearing if the case is not settled and is set for a superior court.  The more convincing your case is, the more likely that the matter will be resolved for a small amount during the settlement conference. You should be prepared to negotiate with the employee during the conference if they would be willing to settle the case. A professional employment lawyer can assess your employee’s claims and advise you on the right settlement offer (if any).

4. Hearing proper

Under Labor Code section 98(a), if the employer is unable to settle the matter with his employee at the settlement conference, or no settlement conference was set initially, the California Labor Commissioner is required to set the case for a hearing, often referred to as “Berman hearing.” The principle behind the hearing is to offer a somewhat speedy way to fix any wage disputes. However, considering the limitations of the state budget, the Berman hearings are usually set for about a year from the date the settlement conference was held.

The Berman hearing is conducted in the office of the California Labor Commissioner, usually in a conference room.  The Labor Commissioner records the trial and the testimony of all the witnesses is provided under oath as if they were testifying in a law court. The Labor Commissioner leading the hearing is flexible on how you, the employer, and the employee(s) can present witnesses and perform cross-examinations. The Labor Commissioner will often ask questions to get a better understanding of some issues. Once the hearing is over, the Labor Commissioner will issue a written order that must be given to all parties. Except the order is appealed, it will remain a binding judgment on both the employer and the employee, and a certified copy is filed with the superior court, and judgment is entered.

5. Possible appeal

After the California Labor Commissioner issue a decision, referred to as an award or order, both the employer and the employee have the right to appeal the decision in court. However, it must be done within ten days from the day the judgment order is served. Once appealed, the case is moved to a suitable superior court. As a “de novo” hearing, the case will have to start completely from the beginning in superior court, and the order of the Labor Commissioner is given no weight. Nevertheless, testimony provided and recorded at the office of the Labor Commissioner’s hearing may be used in court. If an employer is willing to appeal the order of the Labor Commissioner, they must be ready to post a bond in the like sum of the decision with the court. The employer is legally responsible to the worker for attorneys’ fees incurred if the worker is awarded at least $1 on appeal. You can seek counsel immediately from a professional employment lawyer if you have other questions.

Note: As an employer, you may not wish to appeal the decision of the California Labor Commissioner unless you have strong evidence to prevail. Reducing a mere erroneous order is not enough to avoid an undesirable attorney’s fees order. The moment the claim goes to a hearing, you must prepare to win. Regardless, since this is not legal advice, seek counsel before proceeding.

DOES THE DECISION OF THE CALIFORNIA LABOR COMMISSION ALWAYS COUNT?

The decision of the Labor Commissioner may seem insignificant because it can be easily appealed. The trial’s loser can appeal ‘de novo’ to the superior court, which means the case will be given a completely new trial, and the judgment of the California labor commissioner is likely to get no weight. But due to the bond requirement and your ability to receive attorneys’ fees, appealing the decision of a Labor Commissioner is somewhat dangerous for an employer, as may result in the award of substantial attorneys’ fees against the employer if you win any of your claims.

CALIFORNIA LABOR COMMISSIONER JUDGMENT COLLECTIONS

A decision of the office of the Labor Commissioner that is not appealed is forwarded to the local court to be entered as a judgment. This judgment has the same effect as a court judgment, but note that it is just a piece of paper that permits you to claim your right from your employer. The court does not aggressively help you to claim any right or collect monies, in other words. With the judgment, you can attempt to claim your entitlement by yourself, entrust the collection to the DLSE, or you hire a collection attorney. While the DLSE has limited manpower, hiring a collection attorney may result in faster results but you will need to pay a large percentage to them if they collect.

HAVE YOU BEEN WRONGFULLY TREATED BY YOUR EMPLOYER?

Your work is more than just an income source, but a significant part of your routine. If you feel your employer has violated your rights, call to speak with one of our professional employment law attorneys. The team of attorneys at United Employees Law Group brings years of experience and a vast arsenal of legal resources to fight hard for our clients and help you get the justice you deserve.

 

Photo Credit: Shutterstock/Piotr Adamowicz