Save Our State - Prosecutors going after businesses that don't pay employees

Prosecutors going after businesses that don't pay employees

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BY STEVE E. SWENSON, Californian staff writer

Oct 28 2009

With the economy still struggling, many local businesses are hurting and some may be tempted to hold off on paying some employees.

The local district attorney's office has other ideas.

For the first time, prosecutors are going after local outfits that have stopped paying their employees, using a law that the District Attorney's office was recently tipped off about. The law allows them to shutter a business if just two employees go unpaid.

So far they have taken seven businesses to court, Deputy District Attorney John T. Mitchell said.

The first was a farm labor contractor who didn't pay more than 100 employees back in April. But another half dozen were sued by prosecutors in the last couple months.

In the more recent cases, the amount owed to 19 employees is nearly $109,700, or nearly $5,800 each.

Those amounts include lost wages, penalties, interest and fees, Mitchell said. The lion's share of the money is penalties, he said.

The targeted business are TV Max Satellite, Mountain Oak Earthwork, JDA Farm Labor Contractor, PRH Investments, Inc. (Valley Boats and Advanced Air Concepts), Rojas Media Group and Sunset Pools. None of the businesses nor their owners could be reached for comment.

"This is part of the fallout for a troubled economy," Mitchell said. "Some of these are already out of business."

The amounts owed to the 19 employees have already been established in hearings before the state Labor Commissioner, MItchell said. They range from $2,269 to $11,019.

It may be difficult or impossible to collect the money owed, MItchell said.

But the value of the lawsuits is to try to collect money at some point, stop the business from using unpaid employees and warning other businesses that they could face similar consequences, MItchell said.

The business owners cannot start another business unless their former employees are paid, he said.

The first in April was against a farm labor contractor, Jose Luis Cisneros of Delano, who failed to pay 111 employees about $200 to $300 each, according to legal assistance attorney Timara Arancibia.

The potential owed in that case with penalties, interest and fees, however, is $286,000, said Arancibia who works for the California Rural Legal Assistance program in Delano.

MItchell said it was the CRLA which brought the law to his attention.

None of those employees have yet been paid. But there's a chance they can recover money from a state fund, the Farm Worker Remedial Account, which is set up for unpaid farmworkers, she said.

Arancibia said further hearings are set in the next couple months before the state Labor Commissioner to document what the employees can try to collect from the remedial account. She cautioned, "There are no guarantees."

But what the lawsuit did appear to accomplish is to stop Cisneros from using more employees he was unable to pay, she said.

"It's a good sign we have no new clients (from that business)," she said.