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socrateaser
socrateaser, Lawyer
Category: California Employment Law
Satisfied Customers: 37972
Experience:  Retired (mostly)
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I am a small business owner in the state of California and I

Customer Question

Hi I am a small business owner in the state of California and I need help trying to navigate the new piece work/commission law? I have read we have to pay past and present employees dated back to July 2012? Is this true? This could kill us as a business
Submitted: 8 months ago.
Category: California Employment Law
Expert:  socrateaser replied 8 months ago.

Hello,

The new piecework law is summarized as follows:

  • Back payments and relief from related penalties and liquidated damages:
    Employers will have 11½ months to make back payments to their employees for previously unpaid or underpaid rest and recovery breaks and other nonproductive time. Employers who do so will have a legal defense to claims for damages and other penalties associated with the prior failure to pay what was due for such time. The major elements of this back payment and relief plan are as follows:
    • Back payments are required for the time period of July 1, 2012, through December 31, 2015. Employers will have two options for calculating these payments – either use time records to calculate and pay the amounts actually due plus statutory interest or pay four percent (4%) of gross earnings in pay periods in which any work was performed on a piece-rate basis during that same time period. Credits are allowed to employers who started paying piece-rate workers separately for breaks and other nonproductive time after the Gonzalez and Bluford decisions, and payments are not required for employees who fully settled and released these claims.
    • Employers must notify the Department of Industrial Relations by July 1, 2016, of their election to make the back payments and make the required back payments by no later than December 15, 2016. Payments for employees who cannot be located must be made to the Labor Commissioner for deposit in the Unpaid Wage Fund.
    • Employers will be required to maintain and provide appropriate documentation of the payments.
    • Employers who make the required back payments will have an affirmative legal defense against any claim for damages or penalties based on the failure to separately compensate piece-rate workers for rest and recovery breaks and other nonproductive time prior to January 1, 2016.
    • The statute of limitations for these claims will be tolled during the notice and payment periods. Certain claims will be excluded altogether, including claims resolved by final order or judgment, claims asserted in litigation prior to specified dates, and new claims arising after the law goes into effect.
    • The back payment and penalty relief provisions will sunset after all time limits have run.

Note: If you believe that these additional labor costs will be unmanageable, you may want to consider filing for bankruptcy protection, so that you can reduce your exposure to the six months prior to filing bankruptcy.

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Expert:  socrateaser replied 8 months ago.

Hello again,

I see that you have reviewed my answer, but that you have not provided a rating. Do you need any further clarification concerning my answer, or is everything satisfactory?

If you need further clarification, concerning this matter, please feel free to ask. If not, I would greatly appreciate a positive feedback rating for my answer -- otherwise, I receive nothing for my efforts in your behalf.
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