Penalties for Late Paychecks in California

March 2nd 2024

In the state of California, it is a legal requirement for employers to pay wages in a timely manner to their employees. Strict labor laws and regulations are upheld by the State in regard to the payment of wages, to protect the rights of workers. The failure to deliver paychecks promptly can result in penalties and other consequences, depending on the specifics and severity of each situation.

This article covers:

When should I receive my Paycheck in California?

California law requires employers to pay their employees bi-weekly, on a designated day and regular schedule. Employers are permitted to make a one-off change or a permanent change to the payment schedule for legitimate business reasons, as long as employees are properly informed in advance. Employees are entitled to receive payment for the hours/work they have performed within a certain time frame:

  • The paycheck for work performed from the 1st – 15th of the month should be received between the 16th – 26th day of that month.
  • The paycheck for work performed from the 16th to the final day of the month should be received between the 1st and 10th day of the following month.

It is important to remember that if the normal payday falls on a holiday, the paycheck must be delivered by the next working day. 

Certain industries or occupations may have different payday rules. In addition, there are some exceptions to the bi-weekly paycheck rules, outlined by the labor laws in California:

  • For employees with collective bargaining/labor agreements (written legal agreement/contract between an employer, employees and a worker’s union after negotiations), their payday schedule will be determined by the details outlined in their contract
  • Some executive, administrative and professional employees are only paid monthly. In such cases, employees must receive their paycheck on the 26th day of the month in which they undertook work. This paycheck should cover wages for the whole month, including the few days of the month that have not yet occurred.

Legal Framework in California 

The state of California has some of the most extensive labor laws in the US, especially concerning wage and hour laws. The California Labor Code is a statute which establishes and upholds these regulations. Sections 201 to 204 and 210 of the California Labor Code outline the regulations for paychecks, including timely payment of wages.

Penalties for Late Paychecks in California

Penalties are fines that can be given to employers who violate California wage payment laws by failing to pay their employees on time. Those who knowingly and consistently violate such rules may be liable to more severe penalties. The aim of imposing strict financial penalties is to hold employers accountable, preventing them from violating labor laws and employee rights. The various types of penalties under California State law are outlined below:

Civil/Statutory Penalties for late paycheck

California Labor Code 210 states that those who fail to pay employees on time shall be subject to financial penalties as follows:

  • Initial violation – employers will be required to pay $100 for each employee they failed to pay on time
  • Subsequent violation or an intentional violation – employees will be subject to pay $200 for each employee they fail to pay. In addition to this sum, they will be charged an extra 25% of the amount withheld.

There are 2 methods by which the penalty can be recovered:

It is recommended to seek legal advice and consider filing a wage and hour lawsuit if an employer consistently violates California labor laws.

Waiting Time Penalties for Late Final Wages

Waiting time penalties are financial penalties given to employers who purposefully fail to pay the final paycheck of an employee in the necessary time period. Waiting time penalties can be found under California Labor Code 204.

The final paycheck must be paid on time under the conditions of the law, regardless of whether the employee was fired or resigned voluntarily. Under California Labor Code Section 204:

  • If an employee has been fired, despite the circumstances, the employer is required to pay the final paycheck immediately. The final paycheck at the time of termination should consist of all unpaid wages and unused vacation days.
  • If an employee voluntarily resigns and gives the employer 72 hours’ notice, the employer must pay the final paycheck on the last day of work. If the employee does not inform their boss before quitting, then the employer has 72 hours to pay the final paycheck.

There are some exceptions to this rule. In the following industries, employees are not entitled to receive the final paycheck immediately:

  • those in the film industry
  • those in the oil drilling industry
  • those hired through temp agencies
  • those working at theatrical or concert event venues
  • groups in certain areas of food production
  • those with collective bargaining/labor agreements, depending on the stipulations of the contract.

The penalty for failing to deliver a final paycheck adds up to a day’s wage for every day past the legal deadline in which the wages remain unpaid, up to a maximum of 30 days.

Employee Damages for Late Paychecks

Alternatively, an employee can file a lawsuit against their employer for late paychecks. The aim of such a lawsuit is for an employee to recover damages for not receiving financial compensation for their work, an act which violates the law in California. 

In such cases, under California labor laws, the employer may be liable to pay damages to the employee, including back pay, interest for late paychecks and attorney fees and court costs of the employee.

Actions to take if an Employer does not Deliver Paychecks on time in California

There are several steps to follow for people working in California whose employers have not met their legal obligation to pay wages on time:

  1. The first step is to contact the employer or former employer, typically through the human resources or payroll department, to inquire about the late payment. This gives the employer the opportunity to quickly resolve the issue. A typical reason for a delay can be due to administrative errors.
  2. If the employer fails to resolve the issue despite being informed, then employees are entitled to file a complaint with the California Labor Commissioner’s Office. This Office deals with violations of California employment law, including wage and hour violations. By filing a complaint, the Office can take on the case on the behalf of the employee, using legal action.
  3. It is recommended at this point to seek legal advice from an experienced employment law attorney. Consulting with an attorney can be extremely useful to understand legal rights and options on how to proceed to recover wages and damages from an employer who has violated the California labor laws.

Note: it is essential to keep everything from this process well-documented, such as records of hours worked and any communications with employers. If further legal action is required, this information can become important evidence for the case.

Summing Up

The timely payment of employees’ wages is a right protected by California labor laws. The violation of employee rights and the breaking of statutes is a serious matter and there are strict repercussions subjected to employers under the order of the State. Employers are required to pay penalties, such as waiting time penalties, civil fines, statutory fines, interest payments and damages. Employees experiencing issues with late paychecks can take up various actions to resolve violations, including contacting the HR department at work, filing a wage claim and taking legal action. By having a greater understanding of the California labor laws and employee rights, workers can increase their protection against late paycheck violations.

Learn more about California Labor Laws through our detailed guide.

Important Cautionary Note

When making this guide we have tried to make it accurate but we do not give any guarantee that the information provided is correct or up-to-date. We therefore strongly advise you seek advice from qualified professionals before acting on any information provided in this guide. We do not accept any liability for any damages or risks incurred for use of this guide.