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2020 SESSION

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SB 838 Nonpayment of wages; cause of action, penalties.

Introduced by: Adam P. Ebbin | all patrons    ...    notes | add to my profiles | history

SUMMARY AS PASSED:

Nonpayment of wages; private action; liability for payment of wages due under construction contracts; penalties. Provides that an employee has a private cause of action, individually, jointly, with other aggrieved employees as a collective action, or on behalf of similarly situated employees as a collective action, under the federal Fair Labor Standards Act against an employer who fails to pay wages to recover the amount of wages due plus interest at eight percent annually from the date the wages were due, an additional amount as liquidated damages, and reasonable attorney fees and costs. If the court finds that the employer knowingly failed to pay wages, the court shall award the employee reasonable attorney fees and costs and the employer is subject to a civil penalty not to exceed $1,000 for each violation. If the court finds that the employer's failure to pay wages was willful and with intent to defraud the employee, the court shall award the employee triple the amount of wages due and reasonable attorney fees and costs. The measure also provides that any construction contract entered into on or after July 1, 2020, shall be deemed to include a provision under which the general contractor and the subcontractor are jointly and severally liable to pay the wages due to the subcontractor's employees. If the wages due to the subcontractor's employees are not paid, the general contractor is subject to criminal and civil penalties for which an employer is liable for failing or refusing to pay wages. The measure requires the subcontractor to indemnify the general contractor for wages, damages, interest, penalties, or attorney fees owed as a result of the subcontractor's failure to pay the wages unless the subcontractor's failure to pay wages was because of the general contractor's failure to pay moneys due to the subcontractor. The provisions of the bill related to construction contracts only apply if (i) it can be demonstrated that the general contractor knew or should have known that the subcontractor was not paying his employees all wages due, (ii) the construction contract is related to a project other than a single family residential project, and (iii) the value of the project, or an aggregate of projects under one construction contract, is greater than $500,000.

SUMMARY AS PASSED SENATE:

Nonpayment of wages; cause of action; penalties. Provides that an employee has a private cause of action against an employer who fails to pay wages to recover the amount of wages due plus interest at eight percent annually from the date the wages were due. If the court finds that the employer knowingly failed to pay wages to an employee, the court shall award the employee (i) reasonable attorney fees and other costs and (ii) an amount equal to triple the amount of wages due.

SUMMARY AS INTRODUCED:

Nonpayment of wages; private action; liability for payment of wages due under construction contracts; penalties. Provides that an employee has a private cause of action against an employer who fails to pay wages to recover the amount of wages due plus interest at eight percent annually from the date the wages were due. If the court finds that the employer knowingly failed to pay wages to an employee, the court shall award the employee (i) reasonable attorney fees and other costs and (ii) unless the court finds that the employer's failure to pay was because of a bona fide dispute between the employer and employee, an amount equal to triple the amount of wages due. The measure provides that an employer that knowingly fails or refuses to pay wages, unless the failure to pay was because of a bona fide dispute between the employer and its employee, is guilty of a Class 1 misdemeanor if the value of the wages earned and not paid by the employer is less than $10,000 or a Class 6 felony if the value of the wages earned and not paid is $10,000 or more or if the conviction is a second or subsequent conviction. Currently, criminal liability attaches if an employer's nonpayment of wages is willful and with intent to defraud. The measure also provides that construction contracts entered into on or after July 1, 2018, shall be deemed to include a provision under which the general contractor and subcontractor at any tier are jointly and severally liable to pay the wages due to any subcontractor's employees. If the wages due to the subcontractor's employees are not paid, the general contractor is subject to criminal and civil penalties for which an employer is liable for failing or refusing to pay wages. The measure requires the subcontractor to indemnify the general contractor for wages, damages, interest, penalties, or attorney fees owed as a result of the subcontractor's failure to pay the wages unless the subcontractor's failure to pay wages was because of the general contractor's failure to pay moneys due to the subcontractor. The measure also provides that the lack of privity between the general contractor and the employees of the subcontractor is not a defense in an action against the general contractor arising from nonpayment of wages to the subcontractor's employees.