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What is the penalty for failure to pay wages on payday?

Penalties for failing to pay wages on payday are significant, and inability to pay is not a defense.

Under Labor Code Section 210, employers face penalties for each missed payday. The initial penalty is $100 per employee per missed payday.

For subsequent violations, the penalty increases to $200 per employee plus 25% of the wages unlawfully withheld.

These penalties may be recovered by the employee (Labor Code Section 98) or assessed by the Labor Commissioner (Section 98.3).

Labor Code Section 1194.2 allows employees to recover unpaid minimum wages, liquidated damages equal to the unpaid amount, and interest. The Labor Commissioner may calculate damages based on minimum wage for all unpaid hours (excluding overtime).

Additional enforcement actions may include stop-work orders, bank levies and liens on real or personal property.

Owners, directors, officers and managing agents may be held personally liable for failure to timely pay wages.

Employers should review pay practices to ensure compliance and avoid substantial penalties.

Read about Wage and Hour Enforcement and Penalties in the HR Library.

Q&As

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If the minimum wage rate changes mid-pay period or mid-workweek, do we pay the new higher rate for the entire pay period or workweek?
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