CA Penal Code 487m PC - Criminal Wage Theft Charges
In California, willful failure to pay employees their rightful wages is more than just a violation of employment law-it's a crime. Wage theft is criminalized under California Penal Code 487m PC.
This law safeguards workers against dishonest employers who do not pay lawful wages. Recently, new legislation permits the state to prosecute wage theft as grand theft if unpaid wages exceed $950.
California has traditionally treated intentional employer failure to pay wages and tips as a misdemeanor, subject to civil penalties and remedies for recovery.
Effective January 2022, prosecutors may file felony charges under PC 487m if specific conditions are met.
Convictions for wage theft can result in significant penalties, including up to 3 years' imprisonment and fines of up to $10,000, underscoring the serious consequences for the accused.
What Does PC 487m Say?
CA Penal Code 487m PC says, "(a) Notwithstanding Sections 215 and 216 of the Labor Code, the intentional theft of wages in an amount greater than $950 from any one employee, or $2,350 in the aggregate from two or more employees, by an employer in any consecutive 12-month period may be punished as grand theft.
(b) For purposes of this section, "theft of wages" is the intentional deprivation of wages, as defined in Section 200 of the Labor Code, gratuities, as defined in Section 350 of the Labor Code, benefits, or other compensation, by unlawful means, with the knowledge that the wages, gratuities, benefits, or further compensation is due to the employee under the law.
(c) For purposes of this section, "employee" includes an independent contractor, and "employer" consists of the hiring entity of an independent contractor.
(d) Wages, gratuities, benefits, or other compensation that are the subject of a prosecution under this section may be recovered as restitution by Sections 1202.4 and 1203.1. This section does not prohibit the employee or the Labor Commissioner from commencing a civil action to seek remedies provided under the Labor Code for acts prosecuted under this section.
(e) This section does not constitute a change in and does not expand or limit the scope of conduct prohibited by Section 487."
What Exactly is Wage Theft?
Wage theft encompasses various actions in which an employer does not pay employees the wages they have legally earned.
Penal Code 487m specifically describes "theft of wages" as intentionally depriving employees of wages, gratuities, benefits, or other compensation through unlawful means, knowing that these are owed to the employee under the law, as outlined in Sections 200 and 350 of the Labor Code.
Under this law, independent contractors are also considered employees. Wage theft can happen in numerous forms, including, but not limited to:
- Underpayment involves compensating employees below the minimum wage.
- Overtime violations involve failing to compensate for overtime hours or to pay the correct overtime rate.
- Misclassification involves wrongly labeling employees as independent contractors to sidestep paying benefits and overtime.
- Illegal Deductions involve deducting money from an employee's paycheck without proper authorization.
- Failure to provide or compensate employees for legally mandated meal and rest breaks.
- Off-the-clock work involves forcing employees to perform tasks outside of paid hours without compensation.
- Pay stub violations involve not providing precise and detailed wage statements with every paycheck.
- Violations involving the final paycheck involve delaying or withholding final wages.
- Tipped employee violations involve taking tips from tipped employees or not compensating enough when tips and employer wages fall short of the minimum wage.
What Must Be Proven to Convict?
Because proving wage theft requires proof of multiple elements beyond a reasonable doubt, consulting a legal professional can help navigate the complexities of establishing these elements:
- Denial of wages: The prosecutor needs to prove that the employer deliberately did not pay the employee their rightful wages. This can be demonstrated by direct denial or by indirect means, such as misclassification.
- False representation: If an employer falsely states the wages owed to an employee, it can also be considered wage theft. For instance, if an employer promises $20 per hour but actually pays only $15, this constitutes a misrepresentation of wages.
- Earned wages: The prosecutor also needs to prove that the employee was paid for work performed, usually by showing that the employee carried out tasks they were entitled to be compensated for.
- Failure to pay: The prosecution must demonstrate that the employer failed to pay the employee the wages they were owed.
Grand Theft Prosecution for Wage Theft
In 2021, California law was amended by Assembly Bill 1003 to treat wage theft exceeding $950 as grand theft, thereby potentially subjecting the offender to felony charges.
This is an important consideration because felonies carry harsher penalties than misdemeanors, including increased fines and longer prison terms. Wage theft can be prosecuted as grand theft if the employer commits one of the following acts:
- Withholds over $950 from an employee within 12 months; or
- Withholds more than $2350 from two or more employees within 12 months.
What are the Consequences of Wage Theft?
In California, penalties for wage theft are severe. When the theft exceeds $950, it is typically classified as petty theft, a misdemeanor. Sanctions may include fines of up to $1,000 and up to one year in the county detention center.
However, if unpaid wages total more than $950, the offense constitutes grand theft, a "wobbler" offense that may be charged as either a misdemeanor or a felony. A felony conviction for wage theft may result in:
- 16 months, two years, or three years in state prison; and
- Fines can reach as high as $10,000.
Furthermore, understanding the penalties and defenses related to wage theft underscores the importance of consulting a legal professional to protect your rights and ensure proper handling of the case.
What Are the Typical Defenses?
A California criminal defense lawyer might use various defenses if you're accused of wage theft violations. These can include, but are not limited to:
- No Willful Intent: Convictions under PC 487m require proof of intent to withhold payment. You might be acquitted of the charges if you can demonstrate that the payment was withheld unintentionally due to oversight.
- Employee Didn't Earn Wages: If you can prove that payment was withheld due to the employee not working the claimed hours or completing the contracted work, you might be able to have the charges dismissed.
Seeking legal assistance from Cron, Israels & Stark can provide reassurance and guidance in the face of wage theft allegations.