(2010) 50 Cal.4th 1389
Supreme Court of California · Decided November 18, 2010
01. Facts
Jorge A. Pineda worked for Bank of America, N.A., and gave two weeks’ notice of his resignation, which took effect on May 11, 2006 (50 Cal.4th at p. 1393). The bank did not pay Pineda his final wages on his last day as required by Labor Code section 202, but instead paid him on May 15 — four days late (id. at p. 1393). Pineda filed this action on October 22, 2007, seeking section 203 waiting-time penalties even though his wages had since been paid (id. at p. 1393).
02. Procedural posture
The Supreme Court reversed the Court of Appeal, holding the claim was timely and that section 203 penalties are available even where the late-paid wages were eventually paid (50 Cal.4th at p. 1393).
03. Issue
What limitations period governs an action seeking only Labor Code section 203 waiting-time penalties, and whether such penalties are recoverable when the employer paid the late wages before suit.
Holding
Section 203(b) contains a single, three-year limitations period governing all actions for section 203 penalties, regardless of whether the penalty claim is accompanied by a claim for unpaid final wages; and the penalties may be recovered even though the underlying wages were eventually paid.
05. Reasoning
The court rejected the argument that a suit for penalties alone is governed by a shorter (one-year) period, reading section 203(b) to prescribe one three-year period for all section 203 penalty actions. It also held that paying the wages late does not extinguish the penalty, because the statute is designed to penalize delay and incentivize prompt final payment; a contrary rule would let employers escape penalties simply by paying after the deadline but before suit.
Practice Pointer
Pineda gives waiting-time-penalty claims a full three-year reach and confirms penalties survive even after the employer cures the late payment. Plaintiff’s counsel should pursue section 203 penalties for late final pay across the three-year window, and should not be deterred by an employer’s belated payment of the wages themselves.
06. Open questions
Pineda settled the limitations period and post-payment availability of section 203 penalties; questions about what constitutes a “willful” failure to pay (a separate element of section 203) and how good-faith disputes affect the penalty continue to be litigated.
Cite this entry
Pineda v. Bank of America, N.A. (2010) 50 Cal.4th 1389.
“Defendant did not pay plaintiff his final wages on his last day, as required under section 202, but instead paid him on May 15, four days late.” — 50 Cal.4th at p. 1393
Source: California Official Reports – [insert durable courts.ca.gov / Official Reports link at verification].