Rivera et al v. Rivera

Filing 35

ORDER Granting in part and Denying in part 16 Motion for Default Judgment. The Clerk shall close the file. Signed by Judge Koh on 5/17/2011. (lhklc3, COURT STAFF) (Filed on 5/17/2011)

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UNITED STATES DISTRICT COURT

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NORTHERN DISTRICT OF CALIFORNIA

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SAN JOSE DIVISION

United States District Court
For the Northern District of California

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ADAN RIVERA, ET AL.,
Plaintiffs,
v.
NEFTALI RIVERA, D/B/A NR
CONSTRUCTION,
Defendant.

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Case No.: 10-CV-01345-LHK
ORDER GRANTING IN PART AND
DENYING IN PART PLAINTIFFS’
MOTION FOR DEFAULT JUDGMENT

Plaintiffs Adan Rivera, Reyes Barajas, Ignacio Morales, Juan Mendez, Luis Mendez, Rafael

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Mendez, Manuel Chavez, Manuel Valladolid, Guillermo Avila, Victor Vivanco, Enedino Castro,

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Marco Mata, Jose Mendoza, Jose Bocanegra, Daniel Arzate, and Ariel Maya (collectively

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“Plaintiffs”), filed a motion for entry of default judgment on February 15, 2011 after the Clerk of

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the Court entered default as to Defendant Neftali Rivera, doing business as NR Construction

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(“Defendant”). This motion was originally before the Honorable Paul S. Grewal, and was

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subsequently transferred to the undersigned on March 31, 2011. The Court held a hearing on this

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motion on April 21, 2011. For the reasons set forth below, Plaintiff’s motion is GRANTED in part

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and DENIED in part.

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I. BACKGROUND
Plaintiffs are sixteen residents of various locations throughout the Bay Area, including

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Santa Clara and Alameda Counties. See Compl. 1. All Plaintiffs worked for NR Construction, a

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construction company doing business throughout the San Francisco Bay Area, and specifically in
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Case No.: 10-CV-01345-LHK
ORDER GRANTING IN PART AND DENYING IN PART MOTION FOR DEFAULT JUDGMENT

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the cities of San Jose and Milpitas, at some point during the four years prior to the filing of this

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action. Id. at 3. During the course of Plaintiffs’ employment with Defendant, Plaintiffs were paid

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on an hourly basis, and regularly worked in excess of 8 hours per day and more than 40 hours per

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week. Id. at 4. Plaintiffs were variously told that they would be paid hourly, and told at other

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times that they would be paid on a contract basis. Plaintiffs did not have management or

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administrative functions, and performance of their job duties did not require the exercise of

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independent discretion and judgment. Id. Plaintiffs did not maintain any professional licenses with

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the state or practice any recognized profession. Id. All Plaintiffs allege that they were not paid

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their earned wages for numerous hours worked between September 2009 and November 2009,

United States District Court
For the Northern District of California

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while other Plaintiffs allege they were not paid for additional work as well. Id. at 4-5.

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Additionally, Plaintiffs allege that they were not properly compensated for overtime work. Id. at 7-

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9. Finally, Plaintiffs allege that Defendant did not provide lawfully required rest/meal periods and

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wage statements. Id. at 9-10, 12.

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Plaintiffs seek relief under the Federal Fair Labor Standards Act (“FLSA”), 29 U.S.C.

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§ 216; California Labor Code, Cal. Lab. Code §§ 200, 226, 226.7, 1194; California Unfair Business

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Practices, Cal. Bus. & Prof. Code § 17200; and common law breach of contract. On April 28,

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2010, Plaintiff served Defendant with a Summons and Complaint. See Dkt. No. 5. The Clerk of

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the Court entered default against Defendant on June 30, 2010. See Dkt. No. 7. Now pending

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before the Court is Plaintiffs’ motion for entry of default judgment against Defendant under

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Federal Rule of Civil Procedure 55(b)(2). See Pls.’ Mot. for Default Judgment (“Pls.’ Mot.”) at 1,

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Dkt. No. 16. Plaintiffs request an award of $135,640.05 in damages. In the motion for default

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judgment, however, Plaintiffs do not pursue the § 17200 claim.

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II. LEGAL STANDARDS
“The district court’s decision whether to enter a default judgment is a discretionary one.”

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Aldabe v. Aldabe, 616 F.2d 1089, 1092 (9th Cir. 1980). After the Clerk enters a party’s default

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under Fed. R. Civ. P. 55(a), the Court may enter a default judgment against the party. See Fed. R.

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Civ. P. 55(b)(2). “A failure to make a timely answer to a properly served complaint will justify the

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entry of a default judgment.” Benny v. Pipes, 799 F.2d 489, 492 (9th Cir. 1986). “The general rule
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Case No.: 10-CV-01345-LHK
ORDER GRANTING IN PART AND DENYING IN PART MOTION FOR DEFAULT JUDGMENT

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of law is that upon default the factual allegations of the complaint, except those relating to the

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amount of damages, will be taken as true.” TeleVideo Sys., Inc. v. Heidenthal, 826 F.2d 915, 917-

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18 (9th Cir. 1987)) (quoting Geddes v. United Fin. Group, 559 F.2d 557, 560 (9th Cir. 1977))

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(quotation marks omitted). “However, necessary facts not contained in the pleadings, and claims

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which are legally insufficient, are not established by default.” Cripps v. Life Ins. Co. of N. Am.,

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980 F.2d 1261, 1267 (9th Cir. 1992) (citing Danning v. Lavine, 572 F.2d 1386, 1388 (9th Cir.

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1978)). “When entry of judgment is sought against a party who has failed to plead or otherwise

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defend, a district court has an affirmative duty to look into its jurisdiction over both the subject

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matter and the parties.” In re Tuli, 172 F.3d 707, 712 (9th Cir. 1999).

United States District Court
For the Northern District of California

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III. DISCUSSION

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A. Jurisdiction

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This Court has subject matter jurisdiction (federal question) over Plaintiffs’ FLSA claim.

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See 29 U.S.C. § 216(b) (“An action to recover the liability prescribed in either of the preceding

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sentences may be maintained against any employer (including a public agency) in any Federal or

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State court of competent jurisdiction by any one or more employees for and in behalf of himself or

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themselves and other employees similarly situated.”). This Court has supplemental jurisdiction

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over the related state law claims. See 28 U.S.C. 1367(a).

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Moreover, there is no question that the Court has personal jurisdiction over Defendant, a

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sole proprietorship that is incorporated in California, has its primary offices in Dixon, California,

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and operates throughout the San Francisco Bay Area, including Santa Clara and Alameda counties.

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In fact, the claims in this case arise from Plaintiffs employment with NR Construction on projects

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in Santa Clara and Milpitas, California.

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With the jurisdictional prerequisites satisfied, the Court will proceed to analyze Plaintiffs’
claims for damages.

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B. Claims for Damages

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Where an employer fails to maintain accurate payroll records, an employee carries his

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burden under the FLSA if he shows he performed work for which he was improperly compensated

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and produces some evidence to show the amount and extent of that work “as a matter of just and
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Case No.: 10-CV-01345-LHK
ORDER GRANTING IN PART AND DENYING IN PART MOTION FOR DEFAULT JUDGMENT

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reasonable inference.” Anderson v. Mt. Clemens Pottery Co., 328 U.S. 680, 687 (1946),

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superseded by statute on other ground, Portal-to-Portal Act, 61 Stat. 86-87; see also Brock v. Seto,

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790 F.2d 1446, 1448 (9th Cir. 1986); McLaughlin v. Seto, 850 F.2d 586, 589 (9th Cir. 1988). “The

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burden then shifts to the employer to come forward with evidence of the precise amount of work

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performed, or with evidence to negate the reasonableness of the inference to be drawn from the

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employee’s evidence.” Mt. Clemens Pottery, 328 U.S. at 687-88. If the employer fails to produce

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such evidence, the court may then award damages to the employee. Id. at 688. Moreover, the

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award of back wages is not barred for being “too speculative” if the employer failed to keep

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records as required by FLSA. Seto, 790 F.2d at 1448.

United States District Court
For the Northern District of California

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California courts have shifted the burden of proof to employers reasoning that “applying the

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normal burden of proof in such circumstances would unfairly penalize an employee for the

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employer’s failure to keep proper records and would allow the employer to keep the benefits of the

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employee’s labors without paying full compensation.” Amaral v. Cintas Corp. No. 2, 163 Cal.

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App. 4th 1157, 1189 (Cal. App. 1st. 2008). Therefore, “[u]nless the employer can provide accurate

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estimates [of hours worked], it is the duty of the trier of facts to draw whatever reasonable

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inferences can be drawn from the employees’ evidence.” Mt. Clemens Pottery, 328 U.S. at 688.

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Here, the Clerk has entered default against the Defendant. All facts pled by Plaintiffs will

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be deemed as true, and all issues pertaining to the amount of damages will be ascertained from

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those facts and from the reasonable inferences drawn from Plaintiffs’ evidence.

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1. Breach of Contract – Failure to Pay Agreed Upon Wages

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Under California law, to prevail on a breach of contract claim, a plaintiff must show: (1) the

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existence of a contract; (2) performance by the plaintiff; (3) a breach by the defendant; and (4)

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damages. See Careau & Co. v. Sec. Pac. Bus. Credit, Inc., 222 Cal. App. 3d 1371, 1399 (1990).

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Here, Plaintiffs have alleged facts sufficient to establish breach of contract.

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Plaintiffs state that in September 2009, each Plaintiff was employed by NR Construction.

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See Declarations of Sixteen Plaintiffs (“Pls.’ Decl.”) at ¶¶ 5-6, attached to Pls.’ Mot. Each Plaintiff

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entered into an oral agreement with the Defendant, agreeing to furnish labor under an agreed upon

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hourly wage creating a valid contract. Compl. 4, ¶ 15. Moreover, from September 2009 to
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Case No.: 10-CV-01345-LHK
ORDER GRANTING IN PART AND DENYING IN PART MOTION FOR DEFAULT JUDGMENT

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November 2009, Plaintiffs, on behalf of the Defendant, worked on two separate apartment projects,

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one in Milpitas, California and the other in San Jose, California. Pls.’ Mot. at 4 (citing

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declarations). Plaintiffs worked on the sites and performed various jobs involving the installation

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of drywall. Id. Despite performing their work, Plaintiffs allege that they were not paid their agreed

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upon wages for the time periods articulated in each declaration. Pls.’ Decl. ¶¶ 6-8. Plaintiffs’

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allegations are sufficient to establish a contract, performance, and breach.

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Lastly, Plaintiffs supported their request for damages with several documents attached to

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their declarations. Plaintiffs’ documents were only necessary because the Defendant did not

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maintain any records pertaining to hours or wages, and did not provide any form of wage

United States District Court
For the Northern District of California

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statements. Id. at ¶ 7. Because the Defendant did not maintain any records, the Court will draw

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reasonable inferences from records submitted by Plaintiffs.

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Most of the hours recorded were submitted by Plaintiffs Adan Rivera, Juan Mendez, and

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Jose Mendoza, each of whom acted as a foreman or “team leader” on the dry wall projects. See

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Decl. of Adan Rivera, ¶¶ 10-11; Juan Mendez, ¶¶ 10-12; and Jose Mendoza, ¶ 9. These records

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documented that each Plaintiff had worked a certain number of hours, and that Plaintiffs were not

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paid for that work. See Decl. of Adan Rivera, Exh. 1; Juan Mendez, Exh. 1; and Jose Mendoza,

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Exh. 1. Each record showed a handwritten sheet of hours worked on each day for each employee.

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Id. Additionally, Adan Rivera, the foreman during the time in question, attached a document

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showing the date of the last payment each Plaintiff received from the Defendant. See Decl. of

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Adan Rivera, Exh. 3.

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In light of Defendant employer’s failure to maintain records of the Plaintiffs’ contracts and

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failure to provide any wage time sheets, the Court is limited to relying upon the evidence provided

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by Plaintiffs. Plaintiffs’ records, supported by sworn declarations, establish the last date of

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payment, the amount of hours worked by each employee, the pay rate, and the amount of unpaid

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wages due. See Ulin v. Alaea-72, Inc., 2011 U.S. Dist. LEXIS 17468, *38 (N.D. Cal. Feb. 23,

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2011) (although “very few records were kept,” awarding “necessarily approximated” damages for

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failure to pay wages). The Court will rely on certain charts provided by Plaintiffs in summarizing

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the wages due. See Decl. of Adam Pedersen , Exh. 1; Pls.’ Mot. 10, 27.
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Case No.: 10-CV-01345-LHK
ORDER GRANTING IN PART AND DENYING IN PART MOTION FOR DEFAULT JUDGMENT

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Therefore, from the attached sworn declarations, each Plaintiff’s unpaid hours worked were

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combined and multiplied by that Plaintiff’s specific pay rate. Furthermore, additional amounts

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were awarded to specified Plaintiffs for wages that were earned prior to the period of September

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2009 to November 2009, and were not subsequently paid. See Decl. of Adan Rivera, ¶ 9; Ariel

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Maya, ¶¶ 10-12. This leads to the following award:

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Name

Pay Rate

Adan Rivera

$20.00

Total Unpaid
Hours Worked
205

Ignacio Morales
Juan Mendez
Luis Mendez
Rafael Mendez
Manuel Chavez
Manuel Valladolid
Enedino Castro
Jose Bocanegra
Daniel Arzate
Marco Maya
Jose Mendoza
Ariel Maya

$14.00
$15.00
$14.00
$14.00
$14.00
$14.00
$20.00
$14.00
$10.00
$15.00
$20.00
$15.00

113.5
314
218
248
278
62
481.5
163.5
107.5
225
376
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United States District Court
For the Northern District of California

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TOTAL

Total Wages Due
$4,100.00 +
$1,608.00 (Unpaid amounts
from July/Aug. 2009)
$1,589.00
$4,710.00
$3,052.00
$3,472.00
$3,892.00
$868.00
$9,630.00
$2,289.00
$1,075.00
$3,375.00
$7,520.00
$225.00 +
$944.05 (unpaid amount for
Aug./Sept. 2009)
$48,349.05

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2. Failure to Pay Minimum Wage (Cal. Labor Code § 1194)

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California Labor Code Section 1194 provides that “any employee receiving less than the

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legal minimum wage . . . is entitled to recover in a civil action the unpaid balance of the full

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amount of this minimum wage . . . including interest thereon, reasonable attorney’s fees, and costs

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of suit.” See Cal. Labor Code § 1194.1 Section 1194.2 entitles such employees to recover liquated

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Plaintiffs do not seek recovery of wages under Section 1194, but do argue that the alleged
violation of Section 1194 forms the basis for its liquidated damages claim under Section 1194.2.
See Pls.’ Mot. at 13.
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Case No.: 10-CV-01345-LHK
ORDER GRANTING IN PART AND DENYING IN PART MOTION FOR DEFAULT JUDGMENT

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damages “in the amount equal to the wages unlawfully unpaid and interest thereon.” See Cal.

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Labor Code §1194.2.

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On the record and briefing before the Court, Plaintiffs have not established that they are
entitled to liquidated damages on top of the damages awarded under a breach of contract cause of

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action. The fact that Plaintiffs were not paid any wages for certain hours worked does technically

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constitute payment of a lesser amount than the required minimum wage; however, Plaintiffs have

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been awarded the wages that were earned under the breach of contract claim. Moreover, the earned

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wages are actually in excess of the current minimum wage of $6.75 per hour. See 8 C.C.R.

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§11000(2). Plaintiffs have not pointed to any authority supporting their entitlement to recover both

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United States District Court
For the Northern District of California

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liquidated damages and contractual damages for unpaid wages. Compare Armenta v. Osmose, Inc.,

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135 Cal. App. 4th 314, 317-18 (2d Dist. 2005) (where plaintiffs abandoned their claim to recover

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for uncompensated time at their contractual hourly wage, and instead sought liquidated minimum

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wages under Section 1194.2, but did not seek or obtain both types of damages).

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In these circumstances, therefore, Plaintiffs’ claim for liquidated damages under California
Labor Code Section 1194.2 is DENIED.
3. Failure to Pay Overtime (Cal. Labor Code § 1194)
California Labor Code Section 1194(a) states that “any employee receiving less than . . . the

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legal overtime compensation applicable to the employee is entitled to recover in a civil action the

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unpaid balance of the full amount of this . . . overtime compensation, including interest thereon,

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reasonable attorney’s fees, and costs of suit.” See Cal. Labor Code § 1194. “Any work in excess

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of eight hours in one workday and any work in excess of 40 hours in any one workweek must be

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compensated at the rate of no less than one and one-half times the regular rate of pay for an

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employee.” See Cal. Labor Code § 510(a).

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Here, nearly every Plaintiff provides a declaration stating that he worked overtime two

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times per week on average. See Pls.’ Decl. ¶¶ 12-16. Plaintiffs state that a normal work week

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constituted working eight hours a day from 7:00 a.m. to 3:30 p.m. for five days a week. Id.

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However, on about two days a week, Plaintiffs were required to work until about 5:00 or 6:00 p.m.

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Id. Moreover, Plaintiffs state that such overtime hours were not recorded. Id. In fact, Plaintiffs
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Case No.: 10-CV-01345-LHK
ORDER GRANTING IN PART AND DENYING IN PART MOTION FOR DEFAULT JUDGMENT

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allege that they were instructed by Defendant not to write down these overtime hours, and on

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limited occasions such hours were recorded, Defendant would “shave these hours off at the time of

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payroll accounting.” See Pls.’ Mot. at 16; Decl. of Jose Mendoza, ¶¶ 17-18. Since Defendant kept

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no records of overtime, the Court is left to draw reasonable inferences from Plaintiffs’ evidence.

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The only evidence before the Court is sworn declarations by Plaintiffs stating that they
worked one and a half to two and a half hours of overtime about two times a week. See Pls.’ Decl.

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¶¶ 12-16. However, as stated above, the Court will not penalize Plaintiffs for being imprecise or

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approximate in their evidence since this was solely caused by the Defendant’s failure to adequately

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maintain records. See Ulin, 2011 U.S. Dist. LEXIS 17468, *38 (approximating overtime damages

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United States District Court
For the Northern District of California

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where very few records were kept). The burden is on the Defendant to bring forth record evidence,

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and since Defendant has failed to appear in this litigation, Plaintiffs’ evidence stands unrefuted.

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The Court can reasonably infer that each Plaintiff worked at least three hours of overtime a week.

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To calculate overtime wages due, the Court first looks to the overtime compensation rate of

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each Plaintiff (1.5 times the standard pay rate) and multiplies that rate by the number of unpaid

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overtime hours. This leads to the following award:

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Name
Adan Rivera
Ignacio Morales
Juan Mendez
Luis Mendez
Rafael Mendez
Manuel Chavez
Manuel Valladolid
Enedino Castro
Jose Bocanegra
Daniel Arzate
Marco Maya
Jose Mendoza
Ariel Maya
TOTAL

Overtime
Pay Rate
$30.00
$21.00
$22.50
$21.00
$21.00
$21.00
$21.00
$30.00
$21.00
$15.00
$22.50
$30.00
$22.50

Unpaid Overtime
Hours
18
9
24
18
21
21
6
39
15
9
18
30
3

Overtime Due
$540.00
$189.00
$540.00
$378.00
$441.00
$441.00
$126.00
$1,170.00
$315.00
$135.00
$405.00
$900.00
$67.50
$5,647.50

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Case No.: 10-CV-01345-LHK
ORDER GRANTING IN PART AND DENYING IN PART MOTION FOR DEFAULT JUDGMENT

4. Willful Failure to Pay Overtime (Fair Labor Standards Act, 29 U.S.C.
§ 216(b))

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For the Northern District of California

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Plaintiff seeks an award of liquidated damages under the Fair Labor Standards Act (FLSA)
for Defendant’s willful failure to pay overtime. Under FLSA, “[a]ny employer who violates the
provisions of section 206 or section 207 of this title shall be liable to the employee or employees
affected in the amount of their unpaid minimum wages, or their unpaid overtime compensation, as
the case may be, and in an additional equal amount as liquidated damages.” 29 U.S.C. § 216(b)
(emphasis added). Section 207 prohibits any employer from employing any of his employees for a
workweek longer than forty hours unless such employee receives compensation for those hours at a
rate not less than one and one-half times the regular rate at which he is employed. 29 U.S.C. §
207(a)(1).
Section 216(b) clearly mandates that when overtime is not properly provided to employees,
liquidated damages must be additionally awarded to such employees in the amount equal to the
amount already owed. 29 U.S.C. § 216(b). Section 260, however, makes liquidated damages
discretionary where the employer proves that the failure to pay overtime was both in good faith and
based upon such reasonable grounds that it would be unfair to impose liquidated damages upon the
employer. 29 U.S.C. § 260. “Under 29 U.S.C. § 260, the employer has the burden of establishing
subjective and objective good faith in its violation of the FLSA.” See Local 246 Utility Workers
Union of America v. Southern California Edison Co., 83 F.3d 292, 297-298 (9th Cir. 1996).
Here, Defendant has not participated in the litigation and has not provided any mitigating
reasons for noncompliance. As indicated above, Plaintiffs have provided written declarations that
adequately describe the amount of overtime worked. See generally Pls.’ Decl. ¶¶ 12-16.
Moreover, as the Court has already awarded unpaid overtime wages, Plaintiffs are also entitled to
liquidated damages in the same amount. See Seminiano v. Xyris Enter., 2011 U.S. Dist. LEXIS
4298, *10 (C.D. Cal. Jan. 18, 2011) (finding that plaintiffs were owed liquidated damages under
FLSA in the amount equal to plaintiffs’ unpaid overtime wages).
Therefore, the Court will award the same amount of liquidated damages under the FLSA as
was awarded under California Labor Code Section 1194. This leads to the following award:

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Case No.: 10-CV-01345-LHK
ORDER GRANTING IN PART AND DENYING IN PART MOTION FOR DEFAULT JUDGMENT

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United States District Court
For the Northern District of California

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Name
Adan Rivera
Ignacio Morales
Juan Mendez
Luis Mendez
Rafael Mendez
Manuel Chavez
Manuel Valladolid
Enedino Castro
Jose Bocanegra
Daniel Arzate
Marco Maya
Jose Mendoza
Ariel Maya
TOTAL

Overtime
Pay Rate
$30.00
$21.00
$22.50
$21.00
$21.00
$21.00
$21.00
$30.00
$21.00
$15.00
$22.50
$30.00
$22.50

Unpaid Overtime
Hours
18
9
24
18
21
21
6
39
15
9
18
30
3

Overtime Due
$540.00
$189.00
$540.00
$378.00
$441.00
$441.00
$126.00
$1,170.00
$315.00
$135.00
$405.00
$900.00
$67.50
$5,647.50

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5. Failure to Provide Meal Period Claims (Cal. Labor Code § 226.7)
California Labor Code Section 226.7 provides that “[n]o employer shall require any
employee to work during any meal or rest period . . . .” Cal. Labor Code § 226.7(a). An employer
is required to provide employees with a meal period of not less than 30 minutes if the employee is
employed for more than five hours per day. Cal. Labor Code § 512. “If an employer fails to
provide an employee a meal period or rest period . . . the employer shall pay the employee one
additional hour of pay at the employee’s regular rate of compensation for each work day that the
meal or rest period is not provided.” Cal. Labor Code § 226.7(b).
Here, nearly every Plaintiff provides a sworn declaration that states that they were denied
an uninterrupted thirty minute meal break two times per week on average. See Pls.’ Decl. ¶¶ 1316. Defendant has not appeared, and thus has not refuted Plaintiffs’ evidence. See Ulin, 2011 U.S.
Dist. LEXIS 17468, *44-46 (despite no records being kept, awarding damages for failure to
provide meal periods based on plaintiff’s unrefuted testimony). Therefore, the Court will apply the
standard pay rate of each Plaintiff and multiply it by the number of meal periods not provided.
This leads to the following award:
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Case No.: 10-CV-01345-LHK
ORDER GRANTING IN PART AND DENYING IN PART MOTION FOR DEFAULT JUDGMENT

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United States District Court
For the Northern District of California

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Name
Adan Rivera
Ignacio Morales
Juan Mendez
Luis Mendez
Rafael Mendez
Manuel Chavez
Manuel Valladolid
Enedino Castro
Jose Bocanegra
Daniel Arzate
Marco Maya
Jose Mendoza
Ariel Maya
TOTAL

Pay Rate
$20.00
$14.00
$15.00
$14.00
$14.00
$14.00
$14.00
$20.00
$14.00
$10.00
$15.00
$20.00
$15.00

Meal Periods Not
Provided
12
6
16
12
14
14
4
26
10
6
12
20
2

Mealtime Pay Due
$240.00
$84.00
$240.00
$168.00
$196.00
$196.00
$56.00
$520.00
$140.00
$60.00
$180.00
$400.00
$30.00
$2,510.00

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6. Willful Failure to Pay Plaintiffs All Wages Due Upon Termination (Cal.
Labor Code § 200(a))

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California Labor Code Section 203 provides that “[i]f an employer willfully fails to pay,

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without abatement or reduction, . . . any wages of an employee who is discharged or who quits, the

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wages of the employee shall continue as a penalty from the due date thereof at the same rate until

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paid or until an action therefor is commenced; but the wages shall not continue for more than 30

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days.” Cal. Lab. Code § 203(a). Upon discharge, the employees’ earned and unpaid wages are due

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within 72 hours. Cal. Lab. Code § 201(a).

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An employer effectuates a “discharge” not only when it fires an employee from ongoing

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employment, but also when it releases the employee upon completion of particular job assignment

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or time duration for which he or she was hired. See Smith v. Superior Court, 39 Cal. 4th 77, 92

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(2006). Additionally, the meaning of “willful” under Section 203 “is that an employer has

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intentionally failed or refused to perform an act which was required to be done.” See Amaral, 163

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Cal. App. 4th at 1201. “The employer’s refusal to pay need not be based on a deliberate evil

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purpose to defraud workmen of wages which the employer knows to be due.” Id. Pursuant to 8

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Cal. Code. Reg. § 13520: “A willful failure to pay wages within the meaning of Labor Code

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Section 203 occurs when an employer intentionally fails to pay wages to an employee when those
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Case No.: 10-CV-01345-LHK
ORDER GRANTING IN PART AND DENYING IN PART MOTION FOR DEFAULT JUDGMENT

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wages are due. However, a good faith dispute that any wages are due will preclude imposition of

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waiting time penalties under Section 203. A ‘good faith dispute’ that any wages are due occurs

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when an employer presents a defense, based in law or fact which, if successful, would preclude any

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recovery on the part of the employee.”

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Here, according to the evidence provided, Plaintiffs were not paid certain earned wages at

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all, let alone within 72 hours of discharge as required by California statute. Defendant has not

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provided any justification for noncompliance or raised a “good faith dispute” that wages are due to

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Plaintiffs. Thus, the Court must find in favor of Plaintiffs. Because the statutory maximum of 30

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days has clearly elapsed, the maximum amount afforded by Section 203 is appropriate. See

United States District Court
For the Northern District of California

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Seminiano, 2011 U.S. Dist. LEXIS 4298, *10 (awarding damages for continuing wages pursuant to

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Section 203).

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Therefore, the Court will apply the pay rate of each Plaintiff for a standard work day and
multiply it by the statutory maximum of 30 days. This leads to the following award:
Name

15
16
17
18
19
20
21
22
23
24
25

Adan Rivera
Ignacio Morales
Juan Mendez
Luis Mendez
Rafael Mendez
Manuel Chavez
Manuel Valladolid
Enedino Castro
Jose Bocanegra
Daniel Arzate
Marco Maya
Jose Mendoza
Ariel Maya
TOTAL

Pay per 8-hour 30 Day Statutory
Day
Maximum
$160.00
30
$112.00
30
$120.00
30
$112.00
30
$112.00
30
$112.00
30
$112.00
30
$160.00
30
$112.00
30
$80.00
30
$120.00
30
$160.00
30
$120.00
30

Amount Due Under Cal.
Labor Code § 203
$4,800.00
$3,360.00
$3,600.00
$3,360.00
$3,360.00
$3,360.00
$3,360.00
$4,800.00
$3,360.00
$2,400.00
$3,600.00
$4,800.00
$3,600.00
$47,760.00

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Case No.: 10-CV-01345-LHK
ORDER GRANTING IN PART AND DENYING IN PART MOTION FOR DEFAULT JUDGMENT

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United States District Court
For the Northern District of California

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7. Failure to Provide Wage Statements (Cal. Labor Code § 226(a))
California Labor Code § 226(a) mandates that an employer “furnish each of his or her
employees ... an accurate itemized statement in writing showing (1) gross wages earned, (2) total
hours worked by the employee. . . .” Cal. Lab. Code § 226(a). Under subsection (e) of the same
provision: “[a]n employee suffering injury as a result of a knowing and intentional failure by an
employer to comply with [section 226(a)] is entitled to recover the greater of all actual damages or
fifty dollars ($50) for the initial pay period in which a violation occurs and one hundred dollars
($100) per employee for each violation in a subsequent pay period, not exceeding an aggregate
penalty of four thousand dollars ($4,000) . . . .” Cal. Lab. Code § 226(e).
Under Section 226(a), the employee suffers an “injury” when an employer fails to provide
an employee with accurate, itemized wage statements. See Kisliuk v. ADT Sec. Services, Inc., 263
F.R.D. 544, 548-49 (C.D. Cal. 2008) (“‘actual injury may consist of impairment or diminution . . .
of a right,’ such as Plaintiff's right to receive an itemized pay statement.”). Plaintiffs’ unrefuted
evidence sufficiently establishes injury for purposes of Section 226(a). The statute also requires a
“knowing and intentional failure” to furnish the wage statements. Cal. Lab. Code § 226(e). Here,
Defendant failed to provide any statements or pay stubs as required by law, failed to keep a
complete record of hours worked and wage statements, and instructed employees not to keep or
write down overtime hours. See Pls. Decl. ¶¶ 12-16. Courts in similar situations have found that
such conduct constitutes a knowing and willful violation of Section 226. See Perez v. Safety-Kleen
Sys., 2007 U.S. Dist. LEXIS 48308, *24-25 (N.D. Cal. June 27, 2007) (defendant’s failure to
provide accurate wage statements is a knowing and intentional violation under Section 226, and is
not excused by defendant’s alleged ignorance of requirement to record wage statements); see also
Ulin v. Lovell’s Antique Gallery, 2010 U.S. Dist. LEXIS 99153, *55-56 (N.D. Cal. Sept. 22, 2010)
(defendants’ failure to provide any wage statements for a three-year period is by itself a knowing
and willful violation of Section 226). Defendant, not having appeared, presents no argument or
evidence to the contrary. The Court finds that Defendant’s failure to keep and provide records of
wage statements and instructions to employees not to keep their own records provide sufficient
grounds to establish a knowing and willful violation.
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Case No.: 10-CV-01345-LHK
ORDER GRANTING IN PART AND DENYING IN PART MOTION FOR DEFAULT JUDGMENT

1

The statute permits the employee to recover the greater of all the actual damages or the

2

statutory damages. Cal. Lab. Code § 226(e). As actual damages stemming from the injury cannot

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be specifically ascertained, the Court will award statutory damages. The Court will apply the

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statutory rate of $50.00 for the first pay period, and $100.00 for each subsequent pay period. This

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leads to the following award:

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7

Name

8
9

United States District Court
For the Northern District of California

10
11
12
13
14
15
16
17
18

Adan Rivera
Ignacio Morales
Juan Mendez
Luis Mendez
Rafael Mendez
Manuel Chavez
Manuel Valladolid
Enedino Castro
Jose Bocanegra
Daniel Arzate
Marco Maya
Jose Mendoza
Ariel Maya
TOTAL

Work Weeks
without Wage
Statements
6
3
8
6
7
7
2
13
5
3
6
10
1

Statutory Damages
under Cal. Labor Code
§ 226(a)
$550.00
$250.00
$750.00
$550.00
$650.00
$650.00
$150.00
$1250.00
$450.00
$250.00
$550.00
$950.00
$50.00
$7,050.00

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Case No.: 10-CV-01345-LHK
ORDER GRANTING IN PART AND DENYING IN PART MOTION FOR DEFAULT JUDGMENT

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IV. CONCLUSION
As explained above, Plaintiffs’ motion for entry of default judgment [dkt. #16] is

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GRANTED in part and DENIED in part. Collectively, Plaintiffs are entitled to the following

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amounts:

5

Unpaid
Wages

California
Overtime

FLSA
Liquidated
Damages

Mealtime
Pay

Unpaid
Wages upon
Termination

$48,349.05

$5,647.50

$5,647.50

$2,510.00

$47,760.00

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United States District Court
For the Northern District of California

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Statutory
Damages for
Failure to
Provide Wage
Statements
$7,050.00

Overall, Plaintiffs are entitled to $116,964.05 in damages. The Clerk shall close the file.
IT IS SO ORDERED.

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Dated: May 17, 2011

_________________________________
LUCY H. KOH
United States District Judge

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Case No.: 10-CV-01345-LHK
ORDER GRANTING IN PART AND DENYING IN PART MOTION FOR DEFAULT JUDGMENT