Unpaid Wages and Waiting Time Penalties In California

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The California Labor Code Section 203 ensures that employees, who were terminated or filed a resignation, receive any and all unpaid wages during a prescriptive period of time. To clearly understand your right under Section 203, you first need to know sections 201 and 202.

Section 201 of the California Labor Code states that the employer is legally obligated to pay all earned and unpaid wages accrued by a terminated employee immediately upon termination of contract. Aside from paying all the unpaid wages accumulated from the start of work until the official relinquishment from duty, the employee is also entitled to receive monetary valuation for any unused vacation days. There are only two exceptions to this rule. First, if the employer is working remotely from the administrative office, the employee may be paid within 24 hours of termination. Second, employees working for seasonal services especially food preparation and packing may be paid within 72 hours of termination. Unless covered by these exceptions, failure to comply with the law subjects the employer to certain penalties.

Section 202 of the California Labor Code states that the employer is legally obligated to pay all earned and unpaid wages accrued by a resigned employee within 72 hours of serving the employee’s official resignation. However, if the resignation is filed more than four days in advance, the employer must pay the wages immediately upon discharge from duty. The employee is also entitled to receive monetary valuation of any unused vacation days.

Under California Labor Code Section 203, if the employer intentionally neglects payment of wages or violates section 201 and 202, he or she may be subjected to Waiting Time Penalties. For each day the wages go unpaid, the employer may be penalized a full day of wages.

However, the aggrieved employee must file a complaint for unpaid wages to reclaim his or her wages. Take note that Waiting Time Penalties stop accumulating at the limit of 30 days.

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