Seyfarth Shaw LLP | www.seyfarth.com Litigating CA Wage & Hour and Labor Code Class Actions (22nd Edition) 163 subject to civil penalties under sections 558(a) and 1197.1(a). Atempa held that the “unambiguous language of the statutes at issue applies to Pedrazzani as an ‘other person’ subject to the civil penalties.”923 Under section 558(a), an employer “or other person acting on behalf of the employer” who violates the state’s applicable overtime laws shall be subject to a civil penalty.924 Similarly, section 1197.1(a) provides that an employer “or other person acting either individually or as an officer, agent, or employee of another person” who pays or causes to pay an employee less than the state’s applicable minimum wage shall be subject to a civil penalty.925 The appellate court in Atempa rejected the individual defendant’s appeal that he could not be held individually liable for civil penalties and attorneys’ fees under the Labor Code as a matter of law. Instead, it held that sections 558(a) and 1197.1(a) “expressly allow for the recovery of such civil penalties from an officer/agent of the corporate employer” and these civil penalties and attorneys’ fees could be recovered by plaintiffs through a PAGA representative action.926 Atempa further held that in this inquiry, the identity of the employer (including the employer’s business structure) is irrelevant “for purposes of recovering such civil penalties from the employer’s agent[.]”927 Rather, a “sufficient showing that the officer/agent was responsible for the underlying wage violation” is the applicable standard.”928 Further expanding individual liability for wage and hour claims is Labor Code section 558.1, which, as of 2016, provides that an individual who is an “owner, director, officer, or managing agent of the employer” may be personally liable for violations of the Industrial Welfare Commission Wage Orders and sections 203, 226, 226.7, 1193.6, 1194, or 2802 of the Labor Code.929 Employers have argued, based on the plain reading of the statute, section 558.1 does not confer a private right of action, and only the Labor Commissioner can enforce this statute.930 Plaintiffs, however, have successfully used this statute to pursue Labor Code claims against individuals.931 It remains to be seen how appellate courts will interpret section 558.1. The few decisions to consider it have largely 923 Id. at 825. 924 Id. at 811. 925 Id. 926 Id. at 812 and 822. 927 Id. at 822. 928 Id. 929 Cal. Lab. Code § 558.1. 930 Bowan v. Burnt End LLC, 2018 WL 485961, at *6 (C.D. Cal. Jan. 17, 2018) (declining to rule on whether a private right of action to sue exists under Labor Code section 558.1, because the allegations against the individual defendants were sufficient to state claims against them as “employers” under the Wage Orders). 931 Bloomquist v. Covance, Inc., 2017 WL 1735170, at *3 (S.D. Cal. May 4, 2017) (“Section 558.1(a) provides a right of action against any employer, or “other person acting on behalf of an employer, who violates, or causes to be violated, any provision regulating minimum wages or hours and days of work in any order of the Industrial Welfare Commission, or violates, or causes to be violated, Sections 203, 226, 226.7, 1193.6, 1194, or 2802.”); McClain v. PQ Beverly Hills, Inc., 2017 WL 1250978 (C.D. Cal. Jan. 13, 2017) (refusing to find that individual was a sham defendant because individuals may be held liable pursuant to Labor Code section 558.1).
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