Unpaid Wages, Unpaid Bonuses, Unpaid Commissions

In an earlier blog post, we highlighted that under California statutory law, "wages" are broadly defined, and that case law has specifically included "bonuses" in the definition of wages.

Why it matters....
Pursuant to California Labor Code § 201 et. seq., if an employer discharges an employee, the wages earned and unpaid at the time of discharge are due and payable immediately. Simply put wages are due on the date of termination. If you are employer you should build that into your planning when conducting terminations or layoffs. If you are employee, you should make sure that you are paid all wages due on your date of termination, and certainly prior to signing any release. Failure to properly and timely pay wages can have consequences far in excess of the underlying amount due, including (1) waiting time penalties; (2) interest and (3) attorney's fees.

Waiting Time Penalties
California Labor Code § 203 “[i]f an employer willfully fails to pay, without abatement or reduction, in accordance with sections 201, 201.5, 202, and 205.5, any wages of an employee who is discharged or who quits, the wages of the employee shall continue as a penalty from the due date thereof at the same rate until paid or until an action therefore is commenced.”

Interest
California Labor Code § 218.6 further provides that “[i]n any action brought for the nonpayment of wages, the court shall award interest on all due and unpaid wages at [an annual rate of 10 per cent] as mandated by subdivision (b) of § 3289[1] of the California Civil Code, which shall accrue from the date that the wages were due and payable as provided in Part 1 (commencing with § 200) of Division 2. “

Attorney's Fees
“In any action brought for the nonpayment of wages, fringe benefits, or health and welfare or pension fund contributions, the court shall award reasonable attorney's fees and costs to the prevailing party…” Labor Code §218.5. With the cost to get to trial in high-stakes cases running well into six figures on the plaintiff's side, there is substantial exposure to a defendant company that fails to properly pay wages.

Note: The information contained is not legal advice and does not establish an attorney-client relationship. Our contact information is included and we always offer a free consultation. For more information about UNPAID WAGES, UNPAID BONUSES, UNPAID COMMISSIONS or other areas of EMPLOYMENT law, please visit http://www.adishianlaw.com/, contact us via email to askalg@adishianlaw.com or call us at 415.955.0888 or 310.726.0888. Copyright ALG 2009.

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