An audit shows that California has a large backlog of wage theft claims

Wage theft claims filed by California workers are routinely left in the dark for years by state investigators dealing with a huge backlog of cases, a recent audit of the California Labor Commissioner's office shows.

As a result of the slow pace, employees must wait years for the money they may be owed. the control found it.

When claims are ultimately investigated, the Labor Commissioner's Office often does not recover wages. The audit found that in cases where employees asked for help getting their wages back, they received the full amount owed only 12% of the time.

The backlog of unresolved cases has more than doubled in the past five years, from 22,000 claims to 47,000, the audit found.

The Labor Commissioner would need “hundreds of additional positions within his existing process to eliminate the backlog,” California State Auditor Grant Parks wrote in a letter accompanying the audit to Gov. Gavin Newsom and state lawmakers on Wednesday.

Wage theft occurs when employers fail to pay the minimum wage or overtime or force employees to forego legally mandated break times.

State law requires that a decision on a wage claim be made within 135 days of the initial filing. But the Labor Commissioner's office often takes two years or more to process payroll claims — more than six times longer than the law allows, the audit found.

According to the audit, approximately 2,800 claims involving more than $63.9 million in unpaid wages have been outstanding for five years or more.

“Employees have virtually no recourse because it takes so long. We need urgent recruitment for these positions. We need the state to deal with it,” Lorena Gonzalez, head of the California Labor Federation, said of the audit findings.

Gonzalez said the audit underscored a problem that labor advocates, among others, face have been pointing this out for years. She criticized the state for not acting urgently to better protect workers vulnerable to exploitation, especially low-wage workers.

“Where is the outrage? How many hearings have there been? [lawmakers] had on shoplifting, on crime? Well, this is a crime, and it happens to working people every day.”

The labor commissioner's field offices in Los Angeles, Oakland and Long Beach have among the largest backlogs of claims and take the longest on average to complete wage theft investigations, the audit found.

A slow hiring process and low salaries, which make it difficult for the agency to retain staff and fill vacancies, have contributed to the high vacancy rate. Field office vacancy rates rose to 45% in Santa Ana, 44% in Sacramento, 38% in Oakland and 35% in Los Angeles and Long Beach in June 2023.

But even if all vacant positions were filled, the labor commissioner would lack the manpower needed to clear backlogs and process claims within the timeframe required by law, the audit found. The labor commissioner has approximately 315 vacancies, of which approximately a third are vacant. But 892 full-time jobs are needed, almost three times as many, the audit said.

The audit found that poor technology infrastructure that has led to inaccuracies and flawed data in the agency's case management system have also made it difficult for the agency to track claims.

California's Department of Industrial Relations, which includes the Labor Commissioner's Office, said it is “committed to finding ways to continually improve its programs and ensure that it meets its mission to promote health, safety and economic well-being to protect and improve more than 18 million people. wage earners.”

The department's director, Katrina S. Hagen. said the division is working on improvements to its case management system and conducting a study on staff salaries to improve retention.

And last week was the Ministry of Industrial Relations announced $8.5 million in grants to 17 local prosecutors to implement local wage theft enforcement programs and bring criminal charges against problem employers.

Other California agencies responsible for enforcing labor laws have also been plagued personnel problems and claims of ineffectiveness. The Department of Occupational Safety and Health, known as Cal/OSHA, is facing a 38% job shortage vacancy rate and faced sharp criticism during a hearing in February of the Assembly Committee on Labor and Employment, where farmworkers testified that they were exposed to extreme heat and pesticides while on the job.

The audit's release comes as lawmakers and lobbyists are negotiating the future of California's law, which union leaders say is a crucial alternative to addressing wage theft and other workplace abuses.

The law, known as the Private Attorneys General Act, or PAGA, gives employees the right to file lawsuits against their employers for unpaid wages and to seek civil penalties on behalf of themselves and other employees.

A business-backed initiative seeking to repeal the law will go to a vote in November unless an agreement is reached in the coming weeks.

The California Labor Federation and other labor groups support Assembly Bill 2288, introduced by Ash Kalra (D-San José), which aims to give PAGA more teeth by allowing courts to order employers to correct violations. Advocates say this will ensure that bad behavior by employers is stopped, rather than simply awarding a settlement and allowing a company to return to problematic practices.

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