New Law Expands Time Period for Liquidated Damages in Unpaid Minimum Wage Claims

Governor Brown signed AB 2074, expanding the time frame within which an employee may bring a claim for liquidated damages under Labor Code section 1194.2.

An employee who receives less than the applicable state minimum wage is entitled to bring an action to recover the unpaid wages.  Typically, the employee can bring the claim any time within 3 years of when the wages were earned.  The employee may be able to expand the time frame to 4 years if the employee can establish the failure to pay minimum wage is also an unfair business practice under Business & Professions Code section 17200, et seq.

An employee can also bring a claim for liquidated damages “in an amount equal to the wages unlawfully unpaid and interest thereon.”  AB 2074 amends Labor Code section 1194.2 to make it clear that “A suit may be filed for liquidated damages at any time before the expiration of the statute of limitations on an action for wages from which the liquidated damages arise.”  The statute does not specify whether an employee could recover the liquidated damages going back 4 years under B&P section 17200, but I suspect they can’t, because a 17200 claim seeks “restitution,” not damages.

The new law goes into effect on January 1, 2015.  The statute does not state whether it applies only to claims filed after January 1, 2015, or if a plaintiff can wait until January 1, 2015, to file the claim and take advantage of the new, longer statute of limitations.

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Original article by Robert E. Nuddleman, former associate of The Law Office of Phillip J. Griego.
 
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