April 2016 Bar Bulletin
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April 2016 Bar Bulletin

Seattle Strengthens Wage Theft and Labor Standards Ordinances

From Ogletree Deakins


Seattle Mayor Ed Murray recently signed a measure strengthening the city’s ability to enforce minimum wage and other workplace standards. The Wage Theft Prevention and Labor Standards Harmonization Ordinance 2015 standardizes enforcement procedures, allows for a phased-in private cause of action, and provides key definitions of terms in the Minimum Wage, Administrative Wage Theft, Paid Sick and Safe Time, and Job Assistance ordinances.

In summary, the new ordinance makes the following important changes:

• Provides a private cause of action for violations of the ordinances listed;

• Increases penalties for violating the labor laws in question;

• Decreases fines if the employer pays promptly;

• Provides fines of $1,000 per employee for retaliation resulting from a complaint;

• Allows employees to file anonymous complaints;

• Allows the Office of Labor Standards (OLS) to conduct proactive investigations;

• Limits the City’s right to do business with violating businesses and allows for license denial or revocation;

• Permits the OLS to help workers obtain U-visas; and

• Provides $1 million in grants for education and technical assistance to inform workers of their rights.

Below is a description of the four laws that the new ordinance affects and a summary of the amendments to each.

Wage Theft Law

In April 2015, the OLS was created and authorized to investigate workers’ complaints of “wage theft” — the nonpayment of wages and tips — pursuant to the city’s Wage Theft Ordinance. The ordinance introduced additional notice requirements that went above and beyond those required under state wage-and-hour laws.

Under the ordinance, at the time of hire employers must provide employees with written notice of information such as their rate of pay, tip and tip-sharing policies, pay basis (e.g., whether pay is calculated hourly, daily, weekly, by the shift or by commission), and payday. Each payday, employers must provide written notice of the wages and tips employees received during the pay period. The ordinance contains two notable “rebuttable presumptions” that favor employees.

First, if an issue arises as to an employee’s entitlement to wage and tip compensation, and if the employer does not maintain or retain adequate payroll records (at least three years) or does not allow OLS reasonable access to those records, then a presumption, rebuttable only by “clear and convincing evidence,” arises that the employer violated the ordinance.

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