20 | 2025 Cal-Peculiarities ©2025 Seyfarth Shaw LLP www.seyfarth.com 1.5 The Labor Commissioner—the Division of Labor Standards Enforcement (DLSE) 1.5.1 Complaints for unpaid wages with the DLSE The head of the DLSE is known as the “Labor Commissioner.”19 Employees claiming unpaid wages may file a claim with a local DLSE office, which will investigate and can hold a hearing. The DLSE has no jurisdiction over bona fide independent contractors and only limited jurisdiction over claims by federal, state, county, or municipal employees, and employees working under collective bargaining agreements. The DLSE, through its Bureau of Field Enforcement, has focused its enforcement and collection efforts in particular industries, such as the car wash, restaurant, construction, garment, and agriculture industries.20 The Labor Commissioner has heralded a public awareness campaign—”Wage Theft Is A Crime”—to educate workers about their wage and hour rights.21 The Labor Commissioner can investigate an employer—with or without a filed complaint—when the Labor Commissioner, during a wage claim or investigation, suspects retaliation or discrimination.22 The DLSE schedules settlement conferences and administrative hearings—called Berman hearings—before Deputy Labor Commissioners in various branch offices. Within ten days after service of the notice and the complaint, the defendant (the employer) may file an answer. Within 30 days of the complaint, the DLSE is supposed to notify the parties whether a hearing will be held, whether the DLSE will prosecute the matter itself, or whether no further action will be taken.23 A hearing, if held, is to occur within 90 days of that determination. 24 A continuance of a hearing is rarely granted. Claims that involve a large number of employees and records may attract the attention of the DLSE’s Bureau of Field Enforcement, which may require the employer to undergo an audit. The DLSE can seek liquidated damages for an employer’s failure to pay the minimum wage25 and has three years to collect statutory penalties and fees.26 As of 2022, intentional wage theft—including gratuities “in an amount greater than nine hundred fifty dollars ($950) from any one employee, or two thousand three hundred fifty dollars ($2,350) in the aggregate”—is now considered grand theft punishable as a misdemeanor or felony with jail time.27 In 2023, the California legislature amended the Labor Code to permit public prosecutors to independently prosecute specified violations of the Labor Code that occur within their geographic jurisdictions.28 In addition, the amendment provides that individual agreements that require arbitration of a dispute or limit representative actions do not affect the prosecutor or Labor Commissioner’s ability to enforce the Labor Code. Moreover, a Labor Commissioner order, decision, or award, once final and filed with the county recorder, creates a lien on the employer’s real property as if it were a final judgment creating a judgment lien.29 The conference. The conference determines if the claim can be resolved without a hearing. The parties bring evidence to support their positions but do not testify under oath. If the case is not resolved at the conference, then the Deputy Labor Commissioner determines whether to dismiss the claim or set the matter for a hearing. The Berman hearing. This hearing occurs in an informal setting, but it is a formal proceeding. The parties and witnesses testify under oath and the proceedings are tape-recorded. The hearing officer is not bound by formal rules of evidence and has wide discretion to accept evidence and decide whether to assess penalties. Within 15 days of the hearing, the Labor Commissioner is supposed to serve on the parties an Order, Decision, or Award (ODA), setting forth the hearing officer’s decision and the amount awarded, if any. Can employees waive a Berman hearing in an arbitration agreement? In 2011, the California Supreme Court held that waiver of the Berman hearing would contravene public policy, and that California law prohibiting waiver of a Berman hearing is not preempted by the Federal Arbitration Act.30 The U.S. Supreme Court then reversed this
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