The Labor Code of the State of California generally sets forth the time and manner of paying wages to employees, minimum wage requirements, and mandatory overtime pay. In addition to the provisions of the Labor Code, the Industrial Welfare Commission of the State of California has published 18 “Wage Orders” which further govern employment in the State of California. Those Wage Orders cover specific industries and occupations, and there is even one general minimum Wage Order that applies to all California employers and employees.
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A Free Apartment May Not Be Used as Pay
A “free” apartment may not be used as a credit against the minimum wage requirement without a voluntarily entered into written agreement which provides for that credit.
The part of Order #5 which creates the most confusion and consternation for apartment owners and property management companies is paragraph #10 of the order, which prohibits taking a credit against the minimum wage obligation due to the resident apartment manager without a voluntary written agreement between the employer and the employee.
This means that if the resident apartment manager is given a “free” apartment in exchange for his or her services, the owner or property management company must still pay the resident apartment manager minimum wage for each and every hour worked on the premises unless there is a written agreement, voluntarily entered into between the resident apartment manager and the owner or property management company, which specifically provides that a credit will be taken against the wages owed for the value of the apartment.
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Employer Has Burden of Proof
If the employer has not kept legally required time records for the resident manager employee, the burden of disproving the hours the resident manager claims to have worked falls on the employer!
Wage Order #5 also requires that the apartment owner or property management company maintain time records showing when the resident apartment manager begins and ends each work period! That means that they must develop a system for you as the resident apartment manager to report the number of hours you work each and every day,week,or two-week period.
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Should I File a Claim with the Labor Commissioner?
Many managers consider going to the Labor Commissioner to collect unpaid wages instead of hiring a private attorney to collect those wages in civil court. The thinking is that they don’t have to pay an attorney to go to the Labor Commissioner. There is a flaw in that thinking:
If you go through a hearing in front of the Labor Commissioner it is true that you do not need an attorney. If you bring one the Commissioner cannot order your employer to pay your attorney’s fees. However, it is most likely that your employer will come to the hearing with an attorney.
If you lose before the Labor Commissioner, you have the right to appeal to the Superior Court. (Labor Code § 98.2a) At that appeal you not only are still entitled to have an attorney represent you, you are entitled to recover your attorney’s fees if you win at the appeal. But here is the catch:
If you LOSE at the appeal you will be required to PAY the attorneys’ fees of your victorious employer! (Labor Code § 98.2c)