What Is The Penalty For Unpaid Wages In California?
By Corey Hanrahan
What is the penalty for unpaid wages in California? That depends on what type of violation you are being subjected to. For example, the big penalty that almost every knows about in California is “waiting time penalties.” These are penalties that are triggered only when there is a cessation of the employment relationship (whether by a termination or resignation). The other big measure of damages is liquidated damages for an employer’s failure to pay minimum wage. Those liquidated damages, though, do not apply to unpaid overtime wages.
“…[Waiting time penalties] are penalties that are triggered only when there is a cessation of the employment relationship (whether by a termination or resignation)…“
Waiting time penalties trigger at the time your employment ends. The California Labor Code requires you to be paid all wages owed at the time of your termination, or within 72 hours of your resignation – unless you provide more than 72 hours’ notice of resignation (i.e., you advise your employer on Monday that your last day will be Thursday). If you are not paid all wages owed immediately at the time of your termination, or within 72 hours of resignation, you start to accrue waiting time penalties. These waiting time penalties are calculated at your daily rate of pay, and accrue daily – up to 30 days. So if you were making $120 per day at work (which would equate to being paid $15 per hour for an 8 hour shift), and you were terminated with wages owed (regular wages, vacation pay, commissions, bonuses, etc.), and the employer failed to pay you for 30 or more days, your waiting time pay entitlement would be $3,600. It is worth noting too, the waiting time penalties are calculated by calendar days, not business days.
Waiting time penalties are an automatic penalty upon proving the nonpayment of any amount of wages. So even if you are only owed, or underpaid, a couple of dollars in wages at the time of your termination, you would be entitled to waiting time penalties in the amount of one day of pay, for every day late, up to 30 days. The amount of wages owed is not factored into the calculation of waiting time penalties.
Attorney Corey Hanrahan has helped hundreds of employees seek wages they were owed, and all applicable penalties associated with the employer’s actions. If you are owed wages from your employer or former employer, contact The Hanrahan Firm for a free consultation to see what we can do for you.