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Under new law, withholding wages may be charged as grand theft

On Behalf of | Dec 6, 2021 | Employment Law

There are a number of ways in which employers can engage in wage and hour violations. Sometimes, it’s a matter of poor accounting practices or ignorance of the law. 

However, intentional wage theft is illegal. Beginning on Jan. 1, 2022, a new California law increases the penalties for businesses that are convicted of engaging in it.

What does the new law say?

The new law, which was known as Assembly Bill (AB) 1003 in the legislature, defines wage theft as the “intentional deprivation of wages…gratuities…benefits or other compensation, by unlawful means, with the knowledge that the wages, gratuities, benefits, or other compensation is due to the employee under the law.” This includes independent contractors.

The law, which was authored by Assemblywoman Lorena Gonzales of San Diego, also makes it a crime of grand theft to intentionally withhold more than $950 in wages (including tips, benefits and other compensation) from a single employee or over $2,350 from multiple employees over a period of a year. Employers who are found guilty can be ordered to pay restitution to their employees. They can also face civil litigation from those employees as well as from the California Labor Commissioner.

No California employee should be the victim of wage theft. If you believe that your employer is withholding wages or other compensation – either intentionally or unintentionally – it’s often best to bring your concerns directly to them. If multiple employees are being impacted by the suspected wage theft, it can be helpful to address the problem with your employer as a group. However, if that doesn’t resolve the issue, it may be wise to seek experienced legal guidance.