California’s highest court has made it clear court confirms: employers who fail to pay minimum wage cannot escape liquidated (essentially double) damages by claiming they didn’t know the law. The recent Iloff v. Lapaille decision from the California Supreme Court sends a strong message that ignorance of employment law is no excuse, and workers have powerful protections when they speak up about wage violations.
The Heart of the Issue: Good Faith Isn’t Just Good Intentions
Many workers may have experienced employers who justify paying below minimum wage by claiming they had a “different understanding” of the law or believed their arrangement was somehow exempt. The Supreme Court’s decision in Iloff definitively rejects this approach.
The court held that to establish a “good faith” defense against liquidated damages (i.e. double damages for unpaid minimum wages), an employer must show it made a reasonable attempt to determine the requirements of the law. Simply being ignorant of the law or having good intentions is not enough.
- Liquidated damages are the default rule – when a court finds an employer violated minimum wage laws, they must award double the unpaid minimum wages unless the employer proves good faith
- The burden is on the employer to prove they actively tried to understand and comply with the law
- Ignorance alone doesn’t prove good faith – employers must show they took concrete steps to determine their legal obligations
The Power and Protection of Speaking Up
When workers notice potential minimum wage violations, speaking up is both powerful and protected. If your employer continues to break the law after their error has been addressed, they will likely have a difficult time arguing that they acted in good faith. And if they decide to retaliate against someone for speaking up, the provides robust protections for employees who report violations. For example, California Labor Code Section 1102.5 provides that you are protected when you:
- Disclose information about suspected violations to government agencies
- Report violations to supervisors or others with authority to investigate
- Provide information to public bodies conducting investigations
- Refuse to participate in activities that would violate the law
Significant Consquences for Retaliation
Employers who retaliate face serious consequences, such as:
- Civil penalties up to $10,000 to the employee
- Reasonable attorney’s fees can be awarded to successful plaintiffs
- Damages for lost wages as a result of the retaliation
Taking Action: What You Should Know
If you suspect minimum wage violations:
- Document everything – keep records of hours worked and wages received
- Know your rights – understand that reporting violations is protected activity
- Seek assistance – contact the Labor Commissioner’s office or consult with an employment attorney
- Don’t wait – wage claims have time limits, so prompt action is important
The Bottom Line
California’s employment laws exist to protect workers, and the courts are making clear that employers cannot simply ignore these protections. If you’re not receiving proper minimum wages, you have both the right to speak up and strong legal protections when you do. The law is on your side – use it.
This blog post provides general information about California employment law and is not intended as legal advice for specific situations. If you believe your employer has violated minimum wage laws or retaliated against you for reporting violations, consult with qualified employment counsel to understand your specific rights and options.