AB 1870

AB1870:v98#DOCUMENT

Bill Start

CALIFORNIA LEGISLATURE— 2025–2026 REGULAR SESSION

Assembly Bill

No. 1870

An act to amend Section 50067 of the Public Utilities Code, relating to transportation. An act to amend Section 2699 of the Labor Code, relating to employment.

LEGISLATIVE COUNSEL'S DIGEST

AB 1870, as amended, Flora. San Joaquin Regional Transit District: board of directors. Private Attorneys General Act: penalties: reduction.

The Labor Code Private Attorneys General Act of 2004 authorizes an aggrieved employee, as defined, to bring a civil action on behalf of that employee, and other current or former employees against whom a violation of the same provision of the Labor Code was committed, to enforce a violation of any provision of the Labor Code that provides for a civil penalty to be assessed and collected by the Labor and Workforce Development Agency, as specified, pursuant to certain notice and cure provisions, as prescribed. In a civil action under the act, existing law caps the civil penalty that may be recovered at 15%, if, prior to receiving the notice of violation, or prior to receiving a certain request for records from the aggrieved employee or the employee’s counsel, the employer has taken all reasonable steps to be in compliance with all provisions identified in the notice, as specified. Similarly, existing law caps the civil penalty at 30% if within 60 days of receiving the notice of violation, the employer has taken all reasonable steps to prospectively be in compliance with all provisions identified in the notice. The act requires an evaluation of whether the employer’s conduct was reasonable to be based on a totality of the circumstances.This bill would specify certain practices that may support a finding that the employer took all reasonable steps. Notwithstanding the above-described totality of the circumstances evaluation requirement, the bill would create a rebuttable presumption that the employer took all reasonable steps if they comply with specified compliance activities within the 24 months preceding the alleged violation period, provide documentation to the Labor and Workforce Development Agency, and certify under penalty of perjury that the violation has been cured, as specified. By expanding the scope of the existing crime of perjury, this bill would impose a state-mandated local program.The California Constitution requires the state to reimburse local agencies and school districts for certain costs mandated by the state. Statutory provisions establish procedures for making that reimbursement.This bill would provide that no reimbursement is required by this act for a specified reason.

The San Joaquin Regional Transit District Act authorizes the creation of the San Joaquin Regional Transit District and vests the government of the district in a board of 5 directors. The act establishes a 4-year term of office for each director, except for the directors first appointed to the board, as provided.

This bill would authorize a director to continue serving as a director if the director leaves the legislative body that appointed the director to the board, as specified. The bill would provide that no incompatibility of office results from an elected official serving on the governing board of a legislative body within the district’s service area and as a director.

Digest Key

Vote: MAJORITY Appropriation: NO Fiscal Committee: NOYES Local Program: NOYES

Bill Text

The people of the State of California do enact as follows:

SECTION 1.

Section 2699 of the Labor Code is amended to read:

2699.

(a) Notwithstanding any other provision of law, any provision of this code that provides for a civil penalty to be assessed and collected by the Labor and Workforce Development Agency or any of its departments, divisions, commissions, boards, agencies, or employees, for a violation of this code, may, as an alternative, be recovered through a civil action brought by an aggrieved employee on behalf of the employee and other current or former employees against whom a violation of the same provision was committed pursuant to the procedures specified in Section 2699.3.

(b) For purposes of this part, “person” has the same meaning as defined in Section 18.

(c) (1) For purposes of this part, “aggrieved employee” means any person who was employed by the alleged violator and personally suffered each of the violations alleged during the period prescribed under Section 340 of the Code of Civil Procedure, except that for purposes of actions brought pursuant to paragraph (2), “aggrieved employee” means any person who was employed by the alleged violator against whom one or more of the alleged violations was committed within the period prescribed under Section 340 of the Code of Civil Procedure.

(2) Notwithstanding paragraph (1), a nonprofit legal aid organization that has obtained Section 501(c)(3) tax-exempt status, is a qualified legal services project or qualified support center, as defined in Section 6213 of the Business and Professions Code, and has served as counsel of record in civil actions under this part for at least five years prior to January 1, 2025, may file a civil action pursuant to this part as counsel of record for an aggrieved employee on behalf of the employee and one or more current or former employees against whom one or more of the alleged violations was committed. Nothing in this provision establishes standing for the nonprofit legal aid organization as a party in the civil action.

(d) (1) For purposes of subdivisions (c) and (f) of Section 2699.3, and except for violations of subdivision (a) of Section 226, “cure” means that the employer corrects the violation alleged by the aggrieved employee, is in compliance with the underlying statutes specified in the notice required by this part, and each aggrieved employee is made whole. An employee who is owed wages is made whole when the employee has received an amount sufficient to recover any owed unpaid wages due under the underlying statutes specified in the notice dating back three years from the date of the notice, plus 7 percent interest, any liquidated damages as required by statute, and reasonable lodestar attorney’s fees and costs to be determined by the agency or the court. In case of a dispute over the amount of unpaid wages due, nothing in this part prohibits an employer from curing the alleged violations by paying amounts sufficient to cover any unpaid wages that the agency or court determine could reasonably be owed to the aggrieved employees based on the violations alleged in the notice.

(2) (A) A violation of paragraph (8) of subdivision (a) of Section 226 shall be considered cured only upon a showing that the employer has provided written notice of the correct information to each aggrieved employee. Such notice may be provided in summary form but shall identify correct information for each pay period in which a violation occurred.

(B) A violation of paragraphs (1) to (7), inclusive, and (9) of subdivision (a) of Section 226 shall be considered cured only upon a showing that the employer has provided, at no cost to the employee, a fully compliant, itemized wage statement or, if such information is customarily provided in digital form, reasonable access to a digital or computer-generated record or records maintained in the ordinary course of business containing the same information required on a fully compliant, itemized wage statement, to each aggrieved employee for each pay period during which the violation occurred during the three years prior to the date of the notice. Nothing in this subdivision will impact any right the employee has to request copies of employment records pursuant to Sections 226, 432, and 1198.5.

(e) (1) For purposes of this part, whenever the Labor and Workforce Development Agency, or any of its departments, divisions, commissions, boards, agencies, or employees, has discretion to assess a civil penalty or seek injunctive relief, a court is authorized to exercise the same discretion, subject to the same limitations and conditions, to assess a civil penalty and award injunctive relief.

(2) In any action by an aggrieved employee seeking recovery of a civil penalty available under subdivision (a) or (f), a court may award a lesser amount than the maximum civil penalty amount specified by this part, including the penalty amounts in subdivisions (g) and (h), or may, notwithstanding the limitations set forth in subdivisions (g) and (h) exceed the limitations set forth in those subdivisions, if, based on the facts and circumstances of the particular case, to do otherwise would result in an award that is unjust, arbitrary and oppressive, or confiscatory.

(f) For all provisions of this code except those for which a civil penalty is specifically provided, there is established a civil penalty for a violation of these provisions, as follows:

(1) If, at the time of the alleged violation, the person does not employ one or more employees, the civil penalty is five hundred dollars ($500).

(2) If, at the time of the alleged violation, the person employs one or more employees, the civil penalty is as follows:

(A) One hundred dollars ($100) for each aggrieved employee per pay period, except that:

(i) If, at the time of the alleged violation, the person employs one or more employees, and the alleged violation is a violation of paragraphs (1) to (7), inclusive, or paragraph (9) of subdivision (a) of Section 226, the only civil penalty applicable under this part is twenty-five dollars ($25) for each aggrieved employee per pay period if the employee could promptly and easily determine from the wage statement alone the accurate information specified by subdivision (a) of Section 226. If the alleged violation is a violation of paragraph (8) of subdivision (a) of Section 226, the civil penalty applicable under this part for the violation is twenty-five dollars ($25) for each aggrieved employee per pay period if the employee would not be confused or misled about the correct identity of their employer or, if their employer is a farm labor contractor, the legal entity that secured the services of that employer. This subdivision does not apply if the employer has failed to provide an itemized payroll statement during any of the pay periods at issue.

(ii) The civil penalty is fifty dollars ($50) for each aggrieved employee per pay period if the alleged violation resulted from an isolated, nonrecurring event that did not extend beyond the lesser of 30 consecutive days or four consecutive pay periods.

(B) The civil penalty is two hundred dollars ($200) for each aggrieved employee per pay period if either of the following are met:

(i) Within the five years preceding the alleged violation, the agency or any court issued a finding or determination to the employer that its policy or practice giving rise to the violation was unlawful.

(ii) The court determines that the employer’s conduct giving rise to the violation was malicious, fraudulent, or oppressive.

(3) If the alleged violation is a failure to act by the Labor and Workforce Development Agency, or any of its departments, divisions, commissions, boards, agencies, or employees, there shall be no civil penalty.

(g) (1) In any civil action under this part for an alleged violation of this code, if, prior to receiving the notice of violation required by Section 2699.3, or prior to receiving a request for records pursuant to Section 226, 432, or 1198.5 from the aggrieved employee or the employee’s counsel, the person alleged to have committed the noticed violation has taken all reasonable steps to be in compliance with all provisions identified in the notice, the civil penalty that may be recovered in a civil action pursuant to this part shall not be more than 15 percent of the penalty sought under subdivision (a) or (f).

(2) (A) For purposes of paragraph (1), “all reasonable steps” may include, but are not limited to, any of the following: conducted periodic payroll audits and took action in response to the results of the audit, disseminated lawful written policies, trained supervisors on applicable Labor Code and wage order compliance, or took appropriate corrective action with regard to supervisors.

(2)For purposes of paragraph (1), “all reasonable steps” may include, but are not limited to, any of the following: conducted periodic payroll audits and took action in response to the results of the audit, disseminated lawful written policies, trained supervisors on applicable Labor Code and wage order compliance, or took appropriate corrective action with regard to supervisors. Whether

(B) Whether the employer’s conduct was reasonable shall be evaluated by the totality of the circumstances and take into consideration the size and resources available to the employer, and the nature, severity, and duration of the alleged violations. The existence of a violation, despite the steps taken, is insufficient to establish that an employer failed to take all reasonable steps. The following practices may further support a conclusion that the employer has taken all reasonable steps:

(i) Conducting payroll on a weekly basis.(ii) Utilizing automated timekeeping with daily meal period attestation.(iii) Translating policies into the primary languages of the employees.(iv) Providing quarterly sessions for employees to provide feedback on scheduling and breaks.(C) (i) Notwithstanding subparagraph (B), there is a rebuttable presumption that the employer has taken all reasonable steps if the employer complies with all of the following compliance activities within the 24 months preceding the alleged violation period:(I) Conducts internal payroll or wage statement audits at least once per quarter that verify compliance with wage payment requirements set forth in Sections 201 to 204, inclusive, meal and rest period premiums set forth in Section 226.7, and wage statement content and accuracy requirements set forth in subdivision (a) of Section 226. The employer has a policy to retain records of the audits for at least four years and is in compliance with that policy.(II) Provides annual training for managers and supervisors on wage and hour requirements, meal and rest period compliance, and antiretaliation protections. The employer retains records of attendance and agendas of the trainings.(III) Maintains a written policy allowing employees to report pay or break issues without retaliation through multiple reporting channels, including anonymously. The employer provides written acknowledgment and resolution of any complaints received pursuant to that policy.(IV) Engages a qualified third party, including an attorney or compliance consultant, every two years to review wage and hour compliance. The employer implements a corrective action plan within 60 days of receiving a report on that review.(V) Has a policy to maintain accurate payroll and time records for all nonexempt employees for at least four years and is in compliance with that policy. The employer provides employees with timely access to their own records upon request.(ii) To receive a presumption under this subparagraph, the employer shall do both of the following upon receipt of the notice of violation required by Section 2699.3:(I) Submit documentation of the compliance activities described in clause (i) to the Labor and Workforce Development Agency and comply with an audit of those activities upon request of the agency.(II) Certify under penalty of perjury that any violation has been cured and document any remedial actions taken after receipt of the notice.

(3) Paragraph (1) does not apply if the civil penalty recovered is recovered pursuant to subparagraph (B) of paragraph (2) of subdivision (f).

(h) (1) In any civil action under this part for an alleged violation of this code, if within 60 days after receiving the notice of violation required by Section 2699.3, the person alleged to have committed the noticed violation has taken all reasonable steps to prospectively be in compliance with all provisions identified in the notice, the civil penalty that may be recovered in a civil action under this part shall not be more than 30 percent of the penalty sought under subdivision (a) or (f).

(2) (A) For purposes of paragraph (1), “all reasonable steps” may include, but are not limited to, taking an action to initiate any of the following: conduct an audit of the alleged violations and take action in response to the results of the audit, disseminate lawful written policies as to the alleged violations, train supervisors on applicable Labor Code and wage order compliance, or take appropriate corrective action with regard to supervisors. Whether the employer’s conduct was reasonable shall be evaluated by the totality of the circumstances and take into consideration the size and resources available to the employer, and the nature, severity and duration of the alleged violations. The existence of a violation, despite the steps taken, is insufficient to establish that an employer failed to take all reasonable steps.

(B) Whether the employer’s conduct was reasonable shall be evaluated by the totality of the circumstances and take into consideration the size and resources available to the employer, and the nature, severity and duration of the alleged violations. The existence of a violation, despite the steps taken, is insufficient to establish that an employer failed to take all reasonable steps. The following practices may further support a conclusion that the employer has taken all reasonable steps:(i) Conducting payroll on a weekly basis.(ii) Utilizing automated timekeeping with daily meal period attestation.(iii) Translating policies into the primary languages of the employees.(iv) Providing quartering sessions for employees to provide feedback on scheduling and breaks.(C) (i) Notwithstanding subparagraph (B), there is a rebuttable presumption that the employer has taken all reasonable steps if the employer complies with all of the following compliance activities within the 24 months preceding the alleged violation period:(I) Conduct internal payroll or wage statement audits at least once per quarter that verify compliance with wage payment requirements set forth in Sections 201 to 204, inclusive, meal and rest period premiums set forth in Section 226.7, and wage statement content and accuracy requirements set forth in subdivision (a) of Section 226. The employer has a policy to retain records of the audits for at least four years and is in compliance with that policy.(II) Provide annual training for managers and supervisors on wage and hour requirements, meal and rest period compliance, and antiretaliation protections. The employer shall retain records of attendance and agendas of the trainings.(III) Maintain a written policy allowing employees to report pay or break issues without retaliation through multiple reporting channels, including anonymously. The employer shall provide written acknowledgment and resolution of any complaints received pursuant to that policy.(IV) Engage a qualified third party, including an attorney or compliance consultant, every two years to review wage and hour compliance. The employer shall implement a corrective action plan within 60 days of receiving a report on that review.(V) Has a policy to maintain accurate payroll and time records for all nonexempt employees for at least four years and is in compliance with that policy. The employer shall provide employees with timely access to their own records upon request.(ii) To receive a presumption under this subparagraph, the employer shall do all of the following upon receipt of the notice of violation required by Section 2699.3:(I) Submit documentation of the compliance activities described in clause (i) to the Labor and Workforce Development Agency and comply with an audit of those activities upon request of the agency.(II) Certify under penalty of perjury that any violation has been cured and document any remedial actions taken after receipt of the notice.

(3) Paragraph (1) does not apply if the civil penalty recovered is recovered pursuant to subparagraph (B) of paragraph (2) of subdivision (f).

(i) An aggrieved employee shall not collect a civil penalty for any violation of Sections 201, 202, 203, of the Labor Code, or for a violation of Section 204 that is not willful or intentional, or a violation of Section 226 that is not knowing or intentional or a failure to provide a wage statement, that is in addition to the civil penalty collected by that aggrieved employee for the underlying unpaid wage violation. Nothing in this part or in paragraph (2) of subdivision (e) shall prevent a court, in awarding a civil penalty, from reducing the penalty for any alleged violation if the same conduct or omission resulted in multiple violations of this code.

(j) An employer who satisfies subdivision (g) or (h) and cures a violation shall not be required to pay a civil penalty for that violation. An employer who cures a violation of subdivision (a) of Section 226 as set forth above shall not be required to pay a civil penalty for that violation. Any other employer shall pay a civil penalty of no more than fifteen dollars ($15) per employee per pay period for the statute of limitations set forth in Section 340 of the Code of Civil Procedure for any violations that the employer cures.

(k) (1) Except as provided in paragraph (2), an aggrieved employee may recover the civil penalty described in subdivision (f) and may be awarded injunctive relief in a civil action pursuant to the procedures specified in Section 2699.3 filed on behalf of the employee and other current or former employees against whom a violation of the same provision was committed. Any employee who prevails in any action shall be entitled to an award of reasonable attorney’s fees and costs, including any filing fee paid pursuant to subparagraph (B) of paragraph (1) of subdivision (a) or subparagraph (B) of paragraph (1) of subdivision (c) of Section 2699.3. Nothing in this part shall operate to limit an employee’s right to pursue or recover other remedies available under state or federal law, either separately or concurrently with an action taken under this part.

(2) No action shall be brought under this part for any violation of a posting, notice, agency reporting, or filing requirement of this code, except if the filing or reporting requirement involves mandatory payroll or workplace injury reporting.

(l) No action may be brought under this section by an aggrieved employee if the agency or any of its departments, divisions, commissions, boards, agencies, or employees, on the same facts and theories, cites a person within the timeframes set forth in Section 2699.3 for a violation of the same section or sections of the Labor Code under which the aggrieved employee is attempting to recover a civil penalty on behalf of the employee or others or initiates a proceeding pursuant to Section 98.3.

(m) Except as provided in subdivision (n), civil penalties recovered by aggrieved employees shall be distributed as follows: 65 percent to the Labor and Workforce Development Agency for enforcement of labor laws, including the administration of this part, and for education of employers and employees about their rights and responsibilities under this code, to be continuously appropriated to supplement and not supplant the funding to the agency for those purposes; and 35 percent to the aggrieved employees.

(n) Civil penalties recovered under paragraph (1) of subdivision (f) shall be distributed to the Labor and Workforce Development Agency for enforcement of labor laws, including the administration of this part, and for education of employers and employees about their rights and responsibilities under this code, to be continuously appropriated to supplement and not supplant the funding to the agency for those purposes.

(o) For purposes of this section, the penalty recovered pursuant to this part shall be reduced by one-half if the employees’ regular pay period is weekly rather than biweekly or semimonthly.

(p) The superior court may limit the evidence to be presented at trial or otherwise limit the scope of any claim filed pursuant to this part to ensure that the claim can be effectively tried.

(q) Nothing in this part shall prevent a court from consolidating or coordinating civil actions filed pursuant to this part alleging legally or factually overlapping violations against the same employer.

(r) Nothing contained in this part is intended to alter or otherwise affect the exclusive remedy provided by the workers’ compensation provisions of this code for liability against an employer for the compensation for any injury to or death of an employee arising out of and in the course of employment.

(s) (1) For cases filed on or after July 1, 2016, the aggrieved employee or representative shall, within 10 days following commencement of a civil action pursuant to this part, provide the Labor and Workforce Development Agency with a file-stamped copy of the complaint that includes the case number assigned by the court.

(2) The superior court shall review and approve any settlement of any civil action filed pursuant to this part. The proposed settlement shall be submitted to the agency at the same time that it is submitted to the court.

(3) A copy of the superior court’s judgment in any civil action filed pursuant to this part and any other order in that action that either provides for or denies an award of civil penalties under this code shall be submitted to the agency within 10 days after entry of the judgment or order.

(4) Items required to be submitted to the Labor and Workforce Development Agency under this subdivision or to the Division of Occupational Safety and Health pursuant to paragraph (4) of subdivision (b) of Section 2699.3, shall be transmitted online through the same system established for the filing of notices and requests under subdivisions (a) and (c) of Section 2699.3.

(t) This section shall not apply to the recovery of administrative and civil penalties in connection with the workers’ compensation law as contained in Division 1 (commencing with Section 50) and Division 4 (commencing with Section 3200), including, but not limited to, Sections 129.5 and 132a.

(u) The agency or any of its departments, divisions, commissions, boards, or agencies may promulgate regulations to implement the provisions of this part.

(v) (1) Except as provided in paragraph (2), the amendments made to this section by the act adding this subdivision shall apply to a civil action brought on or after June 19, 2024.

(2) The amendments made to this section by the act adding this subdivision shall not apply to a civil action with respect to which the notice required by subparagraph (A) of paragraph (1) of subdivision (a), paragraph (1) of subdivision (b), or subparagraph (A) of paragraph (1) of subdivision (c) of Section 2699.3 was filed before June 19, 2024.

SEC. 2. No reimbursement is required by this act pursuant to Section 6 of Article XIII B of the California Constitution because the only costs that may be incurred by a local agency or school district will be incurred because this act creates a new crime or infraction, eliminates a crime or infraction, or changes the penalty for a crime or infraction, within the meaning of Section 17556 of the Government Code, or changes the definition of a crime within the meaning of Section 6 of Article XIII B of the California Constitution.

SECTION 1.Section 50067 of the Public Utilities Code is amended to read:

50067.

(a)Except as otherwise provided in this section, the term of office of each director is four years from the time of appointment, except that the chairperson first appointed shall hold office for two years, and the remaining directors first appointed to the board shall classify themselves by lot, so that the two appointed by the board of supervisors shall hold office for one and three years and the two appointed by the city council shall hold office for two and four years.

(b)If a director appointed by a legislative body is a member of the legislative body within the district’s service area and the appointee leaves the legislative body, the appointee may continue to serve as a director until a qualified successor is appointed, unless the appointing legislative body takes express action to unseat the director.

(c)An appointment to fill a midterm vacancy on the board shall be for the unexpired portion of the term.

(d)No incompatibility of office shall result from an elected official serving on the governing board of a legislative body within the district’s service area and as a director.