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Contractor Given $1.9M Citation

Published Monday, July 30, 2018
by CEA's HR Advisors


The California Labor Commissioner’s Office has issued wage theft citations of $1.9 million to Fullerton Pacific Interiors Inc. for failing to properly compensate 472 workers on 26 construction projects throughout Southern California. An investigation revealed that none of the employees were provided rest periods as required by law, 289 workers were not paid for overtime and 28 workers were paid less than minimum wage.

The contractor provided drywall work at hotel, recreation center and casino projects in Los Angeles, Orange and San Bernardino counties from August 2014 to June 2016. In addition to not receiving rest breaks, employees who performed taping and drywall installation were paid a daily rate instead of an hourly wage, which did not properly compensate them for overtime hours.

“In construction, unscrupulous contractors attempt to obscure their wage theft by paying workers a flat rate rather than for all hours worked,” said Labor Commissioner Julie A. Su. “But a daily or other flat rate system does not take the place of minimum wage and overtime obligations.”

The $1,964,679 citation penalty amount includes $1,892,279 payable to the workers and $72,400 in civil penalties. Of the total due to workers, $798,664 is for rest period violations, $386,685 for unpaid overtime and $692,500 for wage statement violations.

The Labor Commissioner’s Office launched an investigation of Fullerton Pacific Interiors after workers complained about pay violations to Carpenters Contractors Cooperation Committee, a nonprofit labor-management organization.

Most workers in California must receive a paid 10-minute rest period for every four hours worked. If workers do not receive rest breaks as required by Industrial Welfare Commission orders for their occupation, the employer must pay one hour of pay at the worker’s regular pay rate for each workday that the break is not provided, and civil penalties of $50 per worker per pay period for the initial violation, which increases to $100 each for subsequent violations.

Source: State of California Department of Industrial Relations, News Release No. 2018-61, July 24, 2018.

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