City Council Hikes Fines for Living Wage Violations

By Jorge Casuso

November 30, 2018 -- Without discussion, the City Council on Tuesday unanimously voted to dramatically hike the fines for those who violate Santa Monica's minimum wage law in an effort to strengthen enforcement.

In some cases fines under the amended ordinance will skyrocket from $75 to $1,000.

The council also added language to the ordinance -- which has been in effect since July 1, 2016 -- to make it easier to access employer records and gain access to employees.

The City has a ten-year contract with the Los Angeles County Department of Consumer and Business Affairs (DCBA) to enforce the law.

"DCBA’s experience enforcing cases in Santa Monica and in Los Angeles County suggests that stronger compliance language would improve enforcement efforts," staff wrote in its report.

Under the changes approved Tuesday, fines for violating the law -- which are a blanket $75 -- would be jacked up based on the nature the violation.

Failure to post a minimum wage bulletin will be $100, while failing to comply with the law and retaliating against employees will carry a $1,000 fine.

All other minimum wage violations will be $500.

The amount of the fines -- which are consistent with the County's --reflect the significance of the violation and constitute an additional incentive to comply" with the law, staff said.

The amended ordinance also establishes an administrative subpoena process that makes it easier to view employer records.

"The ordinance currently does not specifically require a business to provide its records to enforcement officials, nor is there an immediate penalty for a business that does not comply," staff wrote.

The change entitles businesses to a pre-compliance review before being required to provide enforcement staff access to records that could contain private information.

Investigators would need to use the subpoena powers "to access specific employee payroll records, on the basis that employees would have strong privacy interests in their payroll information," staff said.

The process is similar to the one used under the City’s home-sharing and vacation rentals ordinance, staff said.

The amended ordinance also requires employers cooperate with investigators during normal business hours.

The provisions are similar to the County’s ordinance.

According to a report issued by City staff in July, from the fall of 2016 through April 2018, the DCBA responded to 19 inquires ("Minimum Wage Law Has Had No Major Impact on Santa Monica Economy, Report Finds," August 2, 2018).

These resulted in ten investigations involving 110 employees.

For more information about minimum wage in Santa Monica, visit smgov.net/minimumwage.