The Wage Theft Prevention Act (“WTPA”) which went into effect on January 1, 2012 requires all California employers to provide non-exempt employees1 specific information in a notice ('Notice") at the time of hire. The Labor Commissioner has taken the position that all of the information on the Notice must be provided in a single stand-alone document rather than as part of an offer letter. While the WTPA only identifies seven types of information, the WTPA provides authority for the Labor Commissioner to require any other information it deems “material and necessary,” creating some question as to what types of information may be required.
Information Prescribed by Statute
The WTPA (Section 2810.5 of the Labor Code) requires employers to provide new hires with the following information:
Information Added by the Labor Commissioner as “Material and Necessary”
The Labor Commission has posted a sample Notice to Employees. Pursuant to its regulatory authority, the Labor Commissioner is requiring employers to provide the following additional information:
Two of these requirements are particularly challenging for employers. First, with respect to whether the “employment agreement” is oral or written, the Notice simply provides for the employer to check a box for “oral” or “written.” The Labor Commissioner has not provided any information on what constitutes an employment agreement for purposes of this form. Employers, especially those who wish to confirm in writing that the employment relationship is at-will, should proceed cautiously prior to checking a box that may later be used to suggest that the employee has an employment agreement with the employer.
Second, employers must identify “any other business or entity used to hire employees or administer wages or benefits.” Examples of “other business entity” are listed as professional employer organization, employee leasing company or temporary services agency. While an “other” box is available for employers to check, there are no examples for when this box is applicable. It appears that a goal of this section is to inform the employee of any other potential “employer” who could be responsible for the nonpayment of wages. The concern for employers, however, is whether completing this section will be used later as an admission by the employer that it is a joint employer with the “other business entity” and potentially subject to liability for its employment practices.
Employers Should Use the Template Notice
While the Labor Commissioner advises that employers can create their own forms, given the liberty taken by the Labor Commissioner in adding information allegedly “material and necessary,” the conservative approach would be to use the template Notice and consult with counsel about the issues raised above.
For more information on this alert, please contact the lawyers listed below:
John Adkins, email@example.com, 617.951.8551
Jenny Cooper, firstname.lastname@example.org, 617.951.8473
Louis Rodriques, Co-chair, Labor and Employment Group, email@example.com, 617.951.8340
Los Angeles/Orange County
Jacqueline Cookerly Aguilera, firstname.lastname@example.org, 213.229.8439
Debra Fischer, email@example.com, 213.680.6418
Jessica Boar, firstname.lastname@example.org, 213.680.6674
This article was originally published by Bingham McCutchen LLP.