For many years, employees who were not compensated correctly for their work had trouble getting judgments from their employers. In an attempt to remedy this situation, lawmakers in California passed the Fair Day's Pay Act. The law imposed personal liability for specific wage and hour violations committed by owners, directors, officers, and other people in management within a company. This means that any acting agent of a business who is proven to violate wage and hour laws could be personally liable.
The extension of personal liability to certain employees was described in Section 558 and 558.1 of the Fair Day's Pay Act and affirmed in court. These liabilities are limited by laws that require employers to indemnify individuals who work for the company. In one California case, however, a manager was held liable for withholding wages because the company had gone into bankruptcy. This left the manager without indemnification, causing him to be fully liable for all damages rewarded.
Many individuals in management positions may view their liability as surprising or unfair, but they do need to be aware of the law if they want to avoid huge penalties. Corporations are often shielded from these types of lawsuits, so the FDPA gives victims a path to compensation. That means managers should make sure employees under their supervision are being compensated fairly according to the law.
Employees with wage and hour claims may be able to get the compensation they deserve by getting support and guidance from an attorney. During an initial consultation, they will examine the circumstances of a violation and determine who to go after for damages. Reaching a settlement without going to court may be possible, and many attorneys will not charge a fee unless they succeed.