Employment Law Update

Is the California Labor Commissioner closely scrutinizing companies’ compliance with overtime wage and hour laws? Recent comments by the California Labor Commissioner strongly suggest that the California department of Industrial Relations, Division of Labor Standards Enforcement (DLSE) is increasing its scrutiny of California employers. In September 2011, Labor Commissioner Julie Su stated:

“In times like these, enforcement of the minimum wage is critical to maintaining a floor that allows workers to survive,… This enforcement is important not just for employees, but for hardworking employers who shouldn’t have to compete against law-breakers. We want the message to be clear: for employers who play by the rules we are on your side; employers who don’t play by the rules should be prepared to face the consequences of paying twice the amount of wages owed, as well as penalties and interest.”

Commissioner Su’s comments were issued in connection with its announcement that it had filed a $17 million lawsuit against ZipRealty, an Emeryville based real estate firm. The State Labor Commissioner’s action alleges that ZipRealty paid its real estate agent employees less than the minimum wage and failed to pay a premium for overtime hours worked.

This and other cases recently filed indicate that the DLSE is stepping up its efforts to monitor compliance with wage and hour laws and regulations. Employers must be very mindful of Commissioner Su’s comments, which send a powerful message to companies that a decision to ignore overtime and minimum wage laws can lead to grave consequences.

Lisa Chapman
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