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Proposed Increase to Penalties for Wage Violations

    November 18, 2015

    Senate Bill 5568 would enhance the penalties employers face, if they willfully violate Washington State wage laws.  The proposed legislation, if passed, would amend RCW 49.52.070. 

     

    Under the existing law, employers (or any officer, vice principal, or agent thereof) who willfully violate RCW 49.52.050 (Washington wage payment law) may be liable for double the amount of the unpaid wages, as exemplary damages, together with legal fees and costs, provided the employee did not “knowingly submit to such violation”.   

     

    According to Washington case law, an employee “knowingly submits” to withholding of wages, precluding an award of double damages, when he or she intentionally defers to his or her employer the decision as to whether, if ever, he or she will be paid.   And, an employer does not willfully withhold wages, so as to render it civilly liable for double damages, if there is bona fide dispute as to the employer’s obligation to pay.

     

    Senate Bill 5568 does not propose to modify the rule concerning a bona fide dispute and the avoidance of double damages for a non-willful failure to pay.  The Bill, however, would remove the employer’s “knowingly submits” defense.  When an employee consents to, or otherwise, submits to an unlawful wage payment, the employee’s conduct would no longer offer the employer a defense for paying the double damages.

     

    The Bill also seeks to increase the employee’s recovery for willfully withheld wages.  Rather than a doubling of the unpaid wages (e.g., $1 gets the employee $2 for a willful violation), the proposed legislation would award “the amount of the wages unlawfully rebated or withheld plus twice that amount …”  Thus, if an employer willfully withheld $1, the employee would get a judgment for that $1, plus double that amount (i.e., $2), for a total judgment of $3.

     

    Wage claims are common, and the dispute is often whether the failure to pay wages was an accident or willful, or whether the employee participated in or agreed to accept the unlawful wage.  If Senate Bill 5568 passes,  the “knowingly submits” would end, and employer exposure would increase under the new formula for doubling the unpaid wages.

     

    Brian A. Walker helps businesses and individuals in employment, business, and real estate related litigation and transactions from the Wenatchee office of Ogden Murphy Wallace PLLC. You can reach Brian at bwalker@omwlaw.com or at (509) 663-1954.