Labor Code Section 226 requires employers to include the following itemized information for each employee either on the paycheck stub or on a separate statement:
(1) gross wages earned,
(2) total hours worked by the employee, (except for overtime exempt employees),
(3) for employees paid on a piece rate basis, the number of piece-rate units earned and any applicable piece rate,
(4) all deductions,
(5) net wages earned,
(6) the inclusive dates of the pay period for which the employee is paid,
(7) the name of the employee and last four digits of his or her social security number,
(8) the name and address of the legal entity that is the employer, and
(9) all applicable hourly rates in effect during the pay period and the corresponding number of hours worked at each hourly rate by the employee.
An employee who is harmed as a result of the employer’s “knowing and intentional” failure to comply with this itemized wage statement requirement is entitled to recover the greater of all actual damages or fifty dollars ($50) for the initial pay period in which a violation occurs and one hundred dollars ($100) per employee for each violation in a subsequent pay period, not to exceed an aggregate penalty of four thousand dollars ($4,000), and is entitled to an award of costs and reasonable attorney’s fees.
In addition, pursuant to Labor Code Section 226.3, the Labor Commissioner’s office can assess a civil penalty of two hundred fifty dollars ($250) per employee per violation for a violation and one thousand dollars ($1,000) per employee for each violation for a subsequent citation. Section 226.3 goes on to provide: “In enforcing this section, the Labor Commissioner shall take into consideration whether the violation was inadvertent, and in his or her discretion, may decide not to penalize an employer for a first violation when that violation was due to a clerical error or inadvertent mistake.”
A recent case, Heritage Residential Care Inc. v. Division of Labor Standards Enforcement (1-26-2011) held that an employer’s mistake of law was not an inadvertence that the Labor Commissioner needed to take into consideration. In Heritage Residential Care, the employer considered workers who could not provide the required I-9 documentation to be independent contractors and issued them 1099s instead of itemized wage statements. The Court of Appeal found that such a mistake was not an unintentional mistake—which it determined is what the Legislature intended by the use of the word “inadvertent.” Accordingly, the Labor Commissioner’s Office acted well within its authority when it declined to give the employer a break.
