California Labor Code 238.5 – (a) (1) Any individual, business entity, or public entity, …
(a) (1) Any individual, business entity, or public entity, regardless of its form, that, as part of its business, contracts for services in the property services or long-term care industries shall be jointly and severally liable for any unpaid wages, including interest, where the individual, business entity, or public entity has been provided notice, by any party, of any proceeding or investigation by the Labor Commissioner in which the employer is found liable for those unpaid wages, to the extent the amounts are for services performed under that contract.
(2) The issue of joint and several liability under this section shall be determined (A) in a proceeding under Section 98 if the contracting individual, business entity, or public entity is provided notice in the administrative complaint alleging such liability and named a defendant in the course of the Section 98 proceeding, (B) in an administrative proceeding brought by the Labor Commissioner to investigate, prosecute, or recover unpaid wages and interest pursuant to a citation, or in a court action brought by the Labor Commissioner, if the contracting individual, business entity, or public entity is provided preliminary notice by the Labor Commissioner of joint and several liability under this section at least 30 days prior to issuance of a citation, or filing of a court action, or (C) by a court in an action pursuant to Section 98.2. No action for a violation or enforcement of this section shall be brought under Part 13 (commencing with Section 2698) of Division 2.
Terms Used In California Labor Code 238.5
- Agency: means the Labor and Workforce Development Agency. See California Labor Code 18.5
- Complaint: A written statement by the plaintiff stating the wrongs allegedly committed by the defendant.
- Contract: A legal written agreement that becomes binding when signed.
- Corporation: A legal entity owned by the holders of shares of stock that have been issued, and that can own, receive, and transfer property, and carry on business in its own name.
- County: includes "city and county. See California Labor Code 14
- Defendant: In a civil suit, the person complained against; in a criminal case, the person accused of the crime.
- Labor: includes labor, work, or service whether rendered or performed under contract, subcontract, partnership, station plan, or other agreement if the labor to be paid for is performed personally by the person demanding payment. See California Labor Code 200
- Labor Commissioner: means Chief of the Division of Labor Standards Enforcement. See California Labor Code 21
- Prosecute: To charge someone with a crime. A prosecutor tries a criminal case on behalf of the government.
- Violation: includes a failure to comply with any requirement of the code. See California Labor Code 22
- Wages: includes all amounts for labor performed by employees of every description, whether the amount is fixed or ascertained by the standard of time, task, piece, commission basis, or other method of calculation. See California Labor Code 200
(b) The joint and several liability provided by this section shall not apply to unpaid wages owed to employees covered by a bona fide collective bargaining agreement, if the agreement expressly provides for wages, hours of work, working conditions, a process to resolve disputes concerning nonpayment of wages, and a waiver of the joint and several liability provided by this section.
(c) An employer that contracts to provide services in the property services or long-term care industries shall, before entering into such a contract, provide written notice to the other party to the prospective contract of any unsatisfied final judgments against the employer for nonpayment of wages. The notice shall also provide the text of this section. The failure of the employer to provide notice under this subdivision shall not be a defense to the joint and several liability provided by this section.
(d) An employer that contracts to provide services in the property services or long-term care industries shall provide, within 30 days of the entry of the judgment, written notice of any unsatisfied final judgments against the employer for nonpayment of wages to any parties with which the employer is presently under contract to provide services in the property services or long-term care industries. The failure of the employer to provide notice under this subdivision shall not be a defense to the joint and several liability provided by this section.
(e) For the purposes of this section, the following definitions apply:
(1) “Property services” means janitorial, security guard, valet parking, landscaping, and gardening services.
(2) “Long-term care” has the same definition as in Section 238.4.
(3) “Public entity” means a city, county, city and county, district, public authority, public agency, and any other political subdivision or public corporation in the state, but does not include the state.
(f) This section shall not be interpreted to impose joint liability on an individual or the owner of a home-based business, for any property services, to the extent that the property services are provided at the individual or home-based business owner’s primary residence, provided that the primary residence does not have multiple housing units.
(Amended by Stats. 2023, Ch. 656, Sec. 1. (AB 520) Effective January 1, 2024.)