A CalChamber-led coalition of business groups, including local chambers of commerce, has stopped a Cost Driver bill that would have exposed employers to a new 30 percent penalty on orders issued by the Labor Commissioner.
The legislation, AB 1234 (Ortega; D-San Leandro), was placed on the Senate Inactive File last week.
AB 1234 would have penalized employers that exercise their due process rights. It also made other burdensome changes to the existing claims process.
Although the bill was amended to give the Labor Commissioner discretion in setting the penalty based on facts giving rise to a claim, the version sent to the inactive file still included provisions causing concern for the coalition. The coalition called for changes, such as:
- Revising the criteria for waiving the penalty so that settling an alleged claim or losing one claim doesn’t imply that an employer is a “bad actor” rather than a good one.
- Providing the trial court with discretion to reduce the penalty if appropriate.
- Making a defendant’s response to a wage claim due after the informal conference.
- Giving the Labor Commissioner the right to ask for testimony or further evidence and discretion to deal with late responses.
Ashley Hofmann, Senior Policy Advocate, CalChamber
CalChamber members can read more about Wage and Hour Enforcement and Penalties in the HR Library. Not a CalChamber member? Learn more about how CalChamber can help you.
The California Chamber of Commerce Affordability Agenda is a bold approach to highlight legislation that helps businesses and consumers by cutting costs, as well as those policies that drive costs up as Californians worry about day-to-day living expenses. CalChamber’s list will include two categories moving forward: Cost Cutters for legislation that reduces costs for Californians and Cost Drivers which will increase costs for small businesses and consumers.
