Prevailing Wage Disputes

PREVAILING WAGES DISPUTES

Public works contractors and subcontractors located in California must comply with prevailing wage requirements enforced by the California Department of Industrial Relations.  Deviations from these requirements are unlawful, and underpayment of employees has the potential to lead to disastrous wage and hour litigation for employers and business owners.  Unfortunately, making appropriate prevailing wage determinations can be a complex and challenging task, even for knowledgeable and experienced contractors.

Weekly Timesheet

How is Minimum Wage Different?

There are subtle yet critical distinctions differentiating minimum wage from prevailing wage.

Minimum wage is the lowest acceptable rate at which employees may be paid, with rare exceptions for employees who are categorized as “exempt.”  The federal minimum wage, currently $7.25 per hour, is uniform across all industries and professions.  Minimum wage in California is currently $9.00 per hour.

While tipped employees such as servers and bartenders may be paid a lower minimum wage in other states, California law lacks this provision and prohibits employers from paying tipped employees less than minimum wage.  Where conflicts arise between state and federal minimum wage, employers must pay the higher of the two rates.

Prevailing wage is generally described as the minimum rate of pay with which vendors and contractors must compensate employees who work on public works projects.  California defines prevailing wage as “the basic hourly rate paid on public works projects to a majority of workers engaged in a particular craft, classification or type of work within the locality and in the nearest labor market area.”  If the majority of workers are not receiving the same rate, then prevailing wage is determined by “the single or modal rate being paid to the greater number of workers.”

In stark contrast to the minimum wage, prevailing wage (1) can vary dramatically depending on the recipient’s occupation, and (2) is pertinent exclusively to public works employees and employers.  Prevailing wage can be traced back to various federal acts dating from the early 1930s – particularly the Davis-Bacon Act of 1931 – which were collectively designed to prevent contractors from slashing employee pay in order to outbid one another.

Prevailing wage requirements apply to the following types of employees in California:

  • Boilermakers
  • Carpenters
  • Construction Site Drivers
  • Drywall Installers
  • Electricians
  • Hazardous Materials (Hazmat Workers)
  • Laborers
  • Landscapers
  • Masons
  • Metal Roofing Systems Installers
  • Painters
  • Stator Rewinders
  • Telephone Installation Workers
  • Telecommunications Technicians
  • Tree Trimmers

Note the above is not an exhaustive list.

California Prevailing Wage Rate Determination

Unfortunately for employers, there is no single standard establishing one uniform prevailing wage in California.  In fact, interpreting the appropriate wage which employees must be paid can become exceptionally complex as the definition of a “public works project” continues to shift and expand – particularly because prevailing wage rate determinations vary across municipalities and moreover, are subject to periodic updates.

Prevailing wage rate determinations are established by the California DIR, the director of whom issues county-specific determinations twice per year: first on February 22, and then a second time on August 22.  Different wage rates are subject to different expiration dates.  If a given determination fails to account for “a particular craft, classification or type of worker,” a request for a more specific determination must be made within 45 days.

Cash-and-coins

The increasingly blurred line between private projects and public projects often poses a challenge for contractors attempting to navigate California labor laws.  The DIR divides public works projects into two categories:

  • Commercial Projects – These are projects which involve:
    • Residential projects which exceed four stories (including apartments and single-family homes).
    • All non-residential projects, “including new work, additions, alterations, reconstruction and repairs.”
  • Residential Projects – These are projects which involve apartments and single-family homes up to four stories.  Employees working on residential projects must be paid the prevailing wage if the project is being fully or even partially paid for by public funds.

If you’re a public works contractor in California, prevailing wage requirements affect you.  It is critical to have a clear understanding of your rights and responsibilities in order to minimize your chance of being targeted by a lawsuit.

Alternatively, if you are a public works employer and have already been served with a lawsuit, or if you are simply concerned about your current business practices and wish to reduce the risk of inviting an expensive and time-consuming lawsuit, you need dedicated legal support from an aggressive attorney.  The employment law attorneys at Bellatrix PC have extensive experience defending contractors and vendors against employee lawsuits related to wage and pay disputes, and have obtained favorable outcomes for numerous clients across an array of industries.

To schedule a confidential legal consultation, call Bellatrix PC today at (800) 889-8376.

5 Must-Read Business Books That Might Change Your Life

Reading the top 5 Must-Read Business Books

I have a college degree in English Literature. So you would think that I read a lot of novels. You’d be wrong. Since I graduated, I have mostly read must-read business books and law books.

It’s not that I’m boring. (Although I may be that.) Rather, I’m extremely focused on growing Bellatrix PC into the greatest law firm ever. (I may also be a tad bit competitive.)

Running a successful business requires more than vision, dedication and an entrepreneurial spirit. It requires being a lifelong learner.

Business books can inspire, motivate and help you get past operational, management or financial blocks. Here are my favorites:

  • How to Win Friends and Influence People by Dale Carnegie

Published in 1936, this book is still relevant and insightful. This book teaches three fundamental techniques for dealing with people, both in business and everyday life. It also teaches six unique ways to make people like you, twelve ways to turn people to your way of thinking, and how to influence change in people without making them resent you.

This is perhaps one of the most important must-read business books for small business owners and decision makers to read. Understanding people is one of the keys to success in business and sales.

  • The 4 Hour Workweek by Tim Ferris

I didn’t I was an entrepreneur until I read this book in 2007. I started my first business almost immediately after read this book. So Tim Ferris literally changed my life.

This book promises to teach you how to “escape 9-5, live anywhere, and join the new rich.” Working only 4 hours a week is not immediately feasible for an entrepreneur, though, so it’s promise is initially elusive. But the ideas in this book form the cornerstone of a new school of thought in the business world.

Pen-ultimately, The 4 Hour Workweek teaches the art of leverage, which is the key to finding freedom as an entrepreneur. It also teaches you how to eliminate 50% of your work in 48 hours using proven principles. A lot of the work you do does not move the needle enough. Ferris teaches you to ruthlessly slash those things so you can make more money and take back your life.

This Must-read business book is not for the faint of heart.

  • The E-Myth Revisited by Michael Gerber

Truer words have never been put on paper about why small businesses fail than what is in this book. Most small business owners have bought themselves a job and are not flourishing as entrepreneurs. This book explains why through examples and by contrasting how most small businesses operate to successful models, such as franchises.

If you are struggling as a business owner, doing it all, and barely making ends — read this book right now. It could save your business and your sanity.

  • The Hard Thing about Hard Things: Building a Business When There Are No Easy Answers by Ben Horowitz

Building a successful business is hard! I wish more “gurus” would acknowledge this fact.

What is useful about this book is that Horowitz goes there. Ben discusses how difficult it can be to run a successful business. Where other books focus on inspiration, founding a company and getting started, this one focuses on the myriad challenges that can derail a business after it’s up and running.

Throughout the book, the author shares insights on managing, buying, investing in and developing a business (with a focus on tech companies, but applicable to all industries).

  • Dotcom Secrets: The Underground Playbook For Growing Your Company Online by Russell Brunson

When I got this book, I devoured it…. And then I promptly read it again. The only other business book that I’ve read more than once is The 4-Hour Workweek. Now Dotcom Secrets sits dog-eared on my desk and I refer to it regularly.

Dotcom Secrets is a hardcore marketing and sales book. I already knew a lot about marketing and sales when I read it. But this dense book filled in some gaps for me. It’s made easier to digest with a lot of stick figure diagrams.

This book generously doles out evidence-based advice on how to sell to your audience (in any context — not just online). There is applied psychological theory in masterful sales. Don’t just emulate — understand.

Optimizing your sales processes could change your business and change your life.

 

Class Actions

CLASS ACTIONS

“Class action” is a pretty scary term. We hear about these types of cases constantly in the news, usually accompanied by a quick blurb about how a company is paying out millions of dollars in judgment or settlement. But what exactly are class actions and why should the everyday, small business owner be concerned?

At its most basic, a class action is a type of lawsuit in which the claims and rights of several people are decided in a single case. Most plaintiff’s bringing the action are never named in the suit, except a few to act as the “class representatives” whose names will appear on all pleadings filed with the court. Class actions can be wonderful because they allow people whose damages are too small to bring an individual lawsuit to try their cases together Further, sometimes class actions are the only practical way to stop illegal practices. Historically, class action suits have allowed individuals to stand up against the most powerful industries nationwide for deceptive practices and procedures. However, class actions can be detrimental, driving many companies out of business.

Class actions are filed in numerous areas of law, ranging from securities violation suits, product liability and consumer actions, to employment class actions. Employment class action lawsuits are typically brought on behalf of employees of a company for violations such as unpaid overtime, failure to provide breaks, to workplace discrimination.

Why it’s Important to Contact an Attorney at the First Sign of Trouble

As a small business employer, it is important to know how class actions work and how they could harm your bottom line. It is also incredibly important to know how to avoid them altogether.

First, class actions are like a regular lawsuit but on steroids. There are multiple plaintiffs, typically between 30-50 individuals. This means that litigation can quickly get out of hand with investigative work, i.e., discovery. It’s extremely easy to be buried in paperwork early on defending a class action. You will want to retain an attorney immediately and come up with a detailed litigation plan to attempt to eliminate any “sprawl,” essentially streamlining the case down to only what is needed. It’s extremely easy to not see the forest through the trees so to speak in a class action suit. Not having a litigation plan in place early can cost you and your business thousands of dollars.

Second, class actions are incredibly expensive to defend. Remember those 30-50 typical class members I discussed above? Each one of those individuals has claims against your company. There is a lot on the line for you defending a class action. You will want to hire an attorney knowledgeable about class actions and the area of employment law. Because employment law deals with a lot of statutory fines that are already established, it is easy to get an idea of how much a potential judgment could be early on. It is also important to realize that in most situations, the Court must approve any settlement you agree to with the parties. Meaning, if the judge doesn’t think your proposed settlement is “fair enough” for the class action members, he can send you back to the drawing board. Knowing and understanding these issues is vital to any small business owner.

Third, class actions can be pending for years. With the Court budget reductions nationwide, cases are sometimes lingering for several years before ever being heard for trial. Thus, a class action can be the rain cloud over your head for as long as four or five years.

Given all of this, business owners should take proactive steps to ensure they are not hit with a potential class action. Follow all labor codes within your state. You will want to make sure all employees are accurately paid all wages owed and taking all proper meal and rest breaks. This list is not all inclusive as there are numerous labor codes. Having an attorney who can guide you through the employment law landscape before you get served a class action could save you millions in the long run.

If Your Business is Involved in an Employment or Litigation Issue that Could Turn into a Class-Action, Our Attorneys Can Help

If you are unsure whether or not you might be exposed to a potential class action, take the proactive approach and contact Bellatrix PC today at (800) 889-8376 for peace of mind.

If My Employee Criticized My Business On Social Media, Can I Fire Her?

It's a common reaction. An employee bad-mouths you and your business on Facebook. So you fire her. Before the time of social media (and the internet), I was in college. I also worked a job after school where I had a boss who was a strange, quirky person. I did a good...

Do Employers Have to Accommodate Employees Who Object to Serving Gay Customers Based on Religious Beliefs?

So I have a heavy topic for you today: Do employers have to accommodate employees who object to serving gay customers based on religious beliefs? Pretend that you own a bakery. You have an employee who sincerely objects against gay marriage for religious reasons. Your...

Wage Garnishments

WAGE GARNISHMENTS

If one of your creditor’s has won a judgment against you (meaning the creditor sued you for nonpayment of a debt, and won), one of the ways they can seek repayment from you is by a wage garnishment. A wage garnishment essentially means your employer receives an order requiring the employer to hold back a portion of your wages during each pay period to pay to the creditor until your judgment is satisfied, i.e., paid

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It is important to note that the Internal Revenue Service (IRS) receives special treatment. The IRS does not have to have a court judgment to garnish your wages, you simply need to owe back taxes.

If you find yourself holding a notice of wage garnishment, either as the employer or employee, there are few things to know.

First, there are limits to how much can be garnished from a person’s income. Often, the amount varies by state. The typical garnishment limit is usually around 15% of an individual’s income. As an employee, you may be able to contest a garnishment amount by proving living necessity for a lower garnishment amount in court. As an employer, it’s vital that you know what the limits are for your state. Should you accidentally garnish a higher amount than is legally allowed, you may be vulnerable to unwanted employee issues.

Second, most states have a limit as to how long a garnishment can last. Because a creditor is taking a portion of a person’s living wages for each pay period, states have limited how long a creditor may use garnishment in the judgment collection process. Both employees and employers should be knowledgeable of the maximum amount of time a garnishment can be enforced.

Third, mistakes happen. Our attorneys have had calls regarding garnishments ranging from employees being garnished for debts that had already been fully paid years previously to garnishments for the wrong individual altogether. When you receive paperwork for a garnishment, the employer and employee should sit down together and review the paperwork in detail. Make sure it is for the correct person, correct amount and that everyone understands and is aware of what the process entails.

As an employer, you must notify an employee of any wage garnishment you receive on their behalf. Not only are you legally required to provide such notice but you will want to make sure that the employee is aware that their income will be limited for a specific length of time. Providing notice also allows for the employee to seek court or legal assistance should the garnishment be in error. The notice will apprise the employee of their rights and any steps they may take to contest the garnishment.

If your business needs assistance navigating the sometimes murky wage garnishment statutes, Bellatrix PC can help. Contact our firm online, or call us at (800) 449-8992 to schedule a confidential consultation. Ask about our Employer Protection Package.

Notices and Postings

NOTICES AND POSTINGS

Many federal and state employment laws require employers to post certain notices within the work areas advising employees of their respective rights. Other notices are required to be delivered to the employee upon both their hire and/or termination. For example, in California, all employers must meet workplace notices and posting obligations. Both federal and state law mandate the provision of notices and postings in the workplace.

legal notice on pleading paper
Notices are usually provided upon the hiring of each new employee. Notices can range from pamphlets explaining certain employee rights to notices informing the newly hired employee of specifics to their job. There are also notices that may be required upon an employee’s termination or lay off. Other notices are required to be posted in a break room or other room equally accessible to all employees so that employees may easily have access to the information described in the notices.

Examples of notices and postings range from explanations of employee work based rights, minimum wage requirements, unemployment benefits, health and safety notices as well explanations of family leave.

Each of these notices and postings have requirements as to when and where they can be posted or provided. For example, for postings, typically it is required that any and all postings be posted in the employee break room so that the employees can have easy and daily access to the information provided.

In addition, many of the statutes require a recordkeeping component. Recordkeeping requirements can range from how long you are required to maintain documents that memorialize when an employee receives a certain notice to how and when they use the benefit described within the notice.

Finally, most, if not all of the notice or posting statutes contain a penalty provision. Penalties for failure to post or provide a notice to an employee can range from minor monetary fines per violation or large fines, even misdemeanors. Certain notice and posting requirements carry larger fines, even possible jail time.

It is important that all business owners consult with a knowledgeable employment law attorney to ensure that they are following all notice and posting requirements, both on the federal and state level. Failure to do so could result in large fines and even jail time.

Whether you have already provided notices or postings you believe are required, or are simply looking to reduce your company’s potential employment liability, the business attorneys of Bellatrix PC may be able to assist. To arrange for a private legal consultation, call our law offices at (800) 449-8992 today.

Can All My Employees Be Salaried?

Avoid Complicated and Illegal Practices.I remember a call I had with a friend once who is an executive at a mature small business. She had been using the HR product that comes with Paychex as her primary advisor for employment law and wage law issues.

She casually mentioned to me that all of her employees were salaried. As I coughed on my coffee, she asks, “is that wrong?”

Paychex told her that all employees can be salaried. Well, technically, it is possible to do that.

But you really shouldn’t.

Because what you mean is that you are not paying your employees overtime and that is definitely illegal. What Paychex means is that you can have salaried employees whom you also pay overtime — and while that’s possible, there is significant financial disadvantage to that.

Here’s a short explanation.

If you have salaried all your employees, regardless of whether you are paying them overtime, you need an immediate check to avoid a labor audit or class action lawsuit.

We can check your wage law compliance and help you avoid trouble. To learn more, check out our Employer Protection Package.

Video Transcript:

Can all my employees be salaried?

Sometimes business owners ask us: Can all my employees be salaried?
Actually, yes, but paying them a salary doesn’t mean that they are exempt from overtime laws. There is a difference between “salaried” and “exempt”. Plus, paying someone a salary makes deducting time off more complicated and sometimes illegal, so it’s not a good idea for most businesses to salary everyone. That aside, the question these business owners are actually intending to ask is whether you can have all your employees be exempt from over time and wage laws. Almost always, the answer is no. Exempt employees are the exception, not the rule. If you are exempting everyone… call an attorney! You have a serious problem and you should not try to fix it by yourself. Does your business need employment law help? Visit us at bellatrixlaw.com to apply for our Employer Protection services.

You can see the full video on salaried employees on YouTube.