Part 3: 2022 New California Employment Laws – AB 1003 Makes Intentional Wage Theft a Felony, Punishable as Grand Theft

intentional-wage-theftUp until the end of this year, employer violations of wage provisions in California have been classified as mere misdemeanors. However, this past September 2021, Governor Newsom signed off on Assembly Bill No. 1003 (AB 1003) which will render alleged intentional wage theft a felony in California, meaning it will be punishable as a form of grand theft come the beginning of 2022.

There are three distinctions made by AB 1003 that are of particular interest to employees and employers alike:

  • Intentional wage theft qualifies as grand theft if the amount taken is greater than $950 from a single employee, or $2,350 total from two or more employees in a consecutive 12-month period.
  • Wage theft is defined as the “intentional deprivation of wages,” including gratuities, benefits, and other forms of compensation by illegal means. In other words, it’s an act of conscious theft by an employer. 
  • AB 1003 includes independent contractors in its definition of an “employee,” meaning contractors are entitled to the same rights as full-time staff members.

It’s anticipated that the expansion of AB 1003 for more serious wage theft consequences will result in a higher volume of California workplace cases and investigations. Now that intentional wage theft is felony under state law, prosecutors will have broader leeway to prosecute potential wrongdoers. This is because, as opposed to misdemeanors, felonies provide prosecutors additional tools for employer investigations, such as search warrants and access to a grand jury. In fact, district and state attorneys have already been increasing their number of wage theft cases throughout 2021. 

With the incoming implementation of AB 1003 come January 2022, California employers are encouraged to take steps to ensure their operations comply with new wage and hour laws. Some of these preparations include ensuring the employer has clear policies and practices in place with respect to employee meal and rest breaks and the working of overtime; verifying the accuracy of timesheets; setting policies for payroll errors and corrections; delivering paychecks in a timely fashion; looking over independent contractor agreements and tracking the distribution of all gratuities, bonuses, or commissions. 

For more information on the expansion of AB 1003, take a look at these additional online resources:

  • The Economic Policy Institute reports on the explosion in employment cases throughout 2021, including instances of wage theft, misclassification, workers’ compensation insurance fraud, workplace sexual assault, and more. 
  • The National Law Review provides a succinct and easy-to-understand summary of the changes brought about by AB 1003, including the major differences between current wage theft laws and those set to go into effect in 2022. 
  • Lexology tends to the question of how businesses can protect themselves from possible clashes with California’s new set of employment laws. The article references laws related to COVID-19, supplemental paid sick leave extensions, and more, providing brief descriptions as to how businesses can prepare for such changes. 

 

Experienced Employment Law Attorney, Mediator, Arbitrator, Investigator, Legal and Media Commentator 

Twice-named a U.S. News Best Lawyer in America for employment and labor law, Angela Reddock-Wright is an employment and labor law attorney, mediator, arbitrator, and certified workplace and Title IX investigator (AWI-CH) in Los Angeles, CA. Known as the “Workplace Guru,” Angela is an influencer and leading authority on employment, workplace/HR, Title IX, hazing, and bullying issues. Furthermore, she’s been named a “Top California Employment Lawyer” by the Daily Journal and one of Los Angeles’ “Most Influential Minority and Women Attorneys” by the Los Angeles Business Journal.

Angela is a regular legal and media commentator and analyst and has appeared on such media outlets as Good Morning America, Entertainment Tonight, Law and Crime with Brian Ross, Court TV, CNN, NewsNation, ABC News, CBS News, Fox 11 News, KTLA-5, the Black News Channel, Fox Soul – The Black Report, NPR, KPCC, Airtalk-89.3, KJLH Front Page with Dominique DiPrima, the New York Times, the Washington Post, the LA Times, Forbes.com, Yahoo! Entertainment, People Magazine, Essence Magazine, the Los Angeles Sentinel, LA Focus, Daily Journal, Our Weekly and the Wave Newspapers.

Angela is a member of the panel of distinguished mediators and arbitrators with Judicate West, a California dispute resolution company. She also owns her own dispute resolution law firm, the Reddock Law Group of Los Angeles, specializing in the mediation, arbitration, and investigation of employment discrimination, harassment, retaliation, and other workplace claims, along with Title IX, sexual harassment, assault, and misconduct conduct cases, along with hazing and bullying cases in K-12 schools, colleges and universities, fraternities and sororities; fire, police and other public safety agencies and departments; and other private and public sector workplaces.

Reddock-Wright has also launched her own radio show, Legal Lens with Angela Reddock-Wright, airing on Tavis Smiley’s new KBLA Talk 1580 radio station on Saturdays at 11:00 a.m. PT with replays on subsequent Sundays. Listeners may tune-in by downloading the APP @kbla1580 and call the PowerLines at 1-800-920-1580.

For more information regarding resources for employers, businesses, and employees during this time, connect with her on LinkedIn for new updates, or contact her here. You may also follow her on Instagram.

This communication is not legal advice. It is educational only. For legal advice, consult with an experienced employment law attorney in your state or city.

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