< Library - Employment Law          
Wage Claims, Overtime & Other Employee Compensation

EMPLOYMENT CONTRACTS FOR NURSES AND OTHER EMPLOYEES CANNOT BE LESS THAN THE PREVAILING WAGE RATES

A: Your situation is very similar to two Filipino nurses who were allowed by the California Court of Appeal to proceed with their claims against a staffing company. The company required the nurses, Elena Sinolinding and Bermalyn Bascug, to sign an agreement indicating that they will be paid the prevailing wage rate provided by the Labor Department. The staffing company’s contract also required each of them to reimburse the company $20,000 for recruitment and training if the nurses breached the contract.

     It was only when the nurses had left the Philippines and had been working for several months in the United States that they discovered they were being paid less than the prevailing wage rate. The nurses quit their jobs and sued the staffing agency, not only on behalf of themselves but also on behalf of other nurses who were employed and were similarly treated by the staffing company.

     The nurses alleged that the staffing agency violated federal regulations and the Labor Code. Federal regulations required employers hiring foreign workers to pay these workers the prevailing wage rate. The Labor Code prohibits employers from requiring an employee to agree in writing to a term or condition of employment when the employer knows that such term or condition is prohibited by law. The contract the nurses signed also contained illegal penalty provisions in the guise of liquidated damages.

     The staffing company argued that the failure to pay the prevailing wage provided by the Department of Labor was not prohibited by law. The employer also argued that the nurses cannot bring the lawsuit on behalf of others because they had not satisfied the procedural requirements for bringing a class action. Although the trial court agreed with the staffing company, the appellate court did not.

     The appellate court found, among other things, that the nurses may sue the staffing company for failure to pay the prevailing wage rates and for failure to pay minimum wage; and that the nurses did not need to comply with class action requirements to bring a claim under the Private Attorney General Act (PAGA). The law allows an aggrieved employee to bring a claim “on behalf of himself or herself and other current and former employees.” It makes no reference to any of the requirements for bringing a class action.

     These recent cases should be instructive to both employees and employers: Employees, particularly the nurses who enter into unlawful contracts, do have recourse in our courts. Employers are also alerted to the fact that failing to pay the required wage rates or providing undue restrictions in employment agreements may give rise to employee claims under PAGA.

© Law Offices C. Joe Sayas, Jr.