The Labor Code authorizes the Division of Labor Standards Enforcement (DLSE) under the Labor Commissioner (Commissioner) to enforce California’s labor laws, investigate wage claims, and issue orders, decisions, and awards for unpaid wages. When a judgment becomes final, the Commissioner or a judgment creditor may collect the amount owed and recover attorney’s fees and costs spent for enforcing the judgment. If a final judgment against an employer remains unsatisfied after specified periods of time, such as for 30 days, the Commissioner may take enforcement actions, including barring the employer from conducting business in the state.
SB 261 extends who may recover court costs and attorney’s fees for enforcing a judgment to include a public prosecutor.
Additionally, SB 261 requires a court to impose a civil penalty of up to three times the unpaid judgment amount, including post-judgment interest, when an employer fails to pay a final judgment for unpaid wages 180 days after the appeal period ends and no appeal is pending.
SB 261 directs courts to impose the full penalty unless the employer demonstrates by clear and convincing evidence good cause to reduce the penalty. Courts must distribute penalties 50 percent (50 %) to the affected employees and 50 percent (50 %) to the DLSE for enforcement and education purposes.
(SB 261 amends Section 98.2 and adds Sections 238.05 and 238.10 to the Labor Code.)