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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

SUMMARY AS PASSED: (all summaries)

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.


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