California Labor Code § 226(a) requires employers to provide accurate, itemized wage statements that show, among other things, gross and net wages earned, total hours worked, all applicable hourly rates, total deductions, the dates of the pay period, and the employee’s name and the last four digits of his Social Security number or an employee identification number. § 226(e) entitles an employee bringing suit in his or her individual capacity to recover penalties of up to $4,000, plus attorney’s fees and costs if he or she establishes that an employer “knowingly and intentionally” failed to comply with § 226(a) and that he or she suffered “injury” as a result.
In Lopez v. Friant & Associates LLC, the Court of Appeal for the First District of California considered whether the requirements of § 226(e) also apply when an employee brings suit in a representative capacity under the Private Attorney General Act of 2004 (PAGA) and concluded they do not. As the court explained, § 226(e) provides for statutory penalties, while PAGA allows recovery of separate and distinct civil penalties. Accordingly, in a PAGA action, an employer is liable for violations of § 226(a) regardless of whether the violation was “knowing and intentional” or resulted in “injury.”
The Lopez decision underscores the importance of ensuring that all employment practices satisfy the stringent requirements of the California Labor Code. If you have any questions about whether the wage statements you provide your employees comply with California law, please contact the attorneys at Shulman Bastian Friedman & Bui LLP at (949) 340-3400.