Payment of Wages for Special Occupations in the Labor Code

California’s Labor Code, in Division 2, Part 1, Chapter 1, Article 3, contains rules for the payment of wages for special occupations. Article 3 was added in 1945 by Chapter 628. Section 270 prohibits a person, agent, or officer who is engaged in the business of extracting or of extracting and refining or reducing minerals other than petroleum, is required to have on hand or on deposit with a bank or trust company, in the county where such property is located cash or readily salable securities of a market value sufficient to pay the wages of every person employed on the mining property, or in connection therewith, for that period. Violation of this section would result in a misdemeanor.

Section 270.5 provides that no one, including a logging contractor, or sawmill operations contractor, engaged in the business of logging or operating a sawmill for converting logs into lumber, must have a market value sufficient to pay the wages of every person employed in connection with the operations in any period for which a single payment of wages is made.

If they do not have the monies on hand, then they must deposit with the Labor Commissioner the bond of a surety company authorized to do business within the state, acceptable to the Labor Commissioner, conditioned upon the payment of all wages found by the Labor Commissioner to be due and unpaid in connection with the operations. Violation of this section would result in a misdemeanor.

Section 270.6 states that no one, without a permanent and fixed place of business or residence in this state who uses or employs any person in the door-to-door selling of any merchandise, in any similar itinerant activity, or in any telephone solicitation, is permitted to fail or neglect, before commencing work in any period for which any single payment of wages is made or for four calendar weeks, whichever is longer, to not have monies on hand, or on deposit in a bank, or have a bond of a surety company with the Labor Commissioner. Violation of this section would result in a misdemeanor.

Section 271 state that no one engaged in the business of promoting a theatrical enterprise where living individuals are used or employed in the presentation, is permitted to fail or neglect, before producing such enterprise in any period for which a single payment of wages is made, to have on hand or on deposit with a bank or trust company, cash or readily salable securities of a market value sufficient to pay the wages of every individual used or employed in the production of such enterprise, or in connection therewith for such period. There are exceptions to this provision for certain individuals in a radio or television broadcasting enterprise. Violation of this section would result in a misdemeanor.

Section 272 requires every person, agent, or officer engaged in specified businesses to keep conspicuously posted upon the premises where persons are employed, a notice specifying the name and address of the bank or trust company where the required cash or readily salable securities are on deposit, or the name of the surety or sureties on the bond deposited. Failure to keep the notice conspicuously posted is prima facie evidence of a violation of law.

Section 273 defines the following terms: “All activities relating to an adverse license or registration action,” “farm labor contractor,” “final judgment issued by a court,” “garment manufacturer,” “involving unpaid wages,” “licensee,” and “registrant.” The Labor Commissioner is to require an applicant for any of the following to submit a statement as to whether the applicant has satisfied all requirements imposed by a final judgment issued by a court or by a final order issued by the Labor Commissioner or by an accord involving unpaid wages:

• Licensure as a farm labor contractor.
• Registration as a garment manufacturer.
• Renewal or reinstatement of a farm labor contractor license or a garment manufacturer registration.
• A change in the persons identified.

A licensee or registrant is required to notify the Labor Commissioner in writing within 90 days of the date of a final judgment issued by a court, a final order issued by the Labor Commissioner, or an accord that imposes on the licensee or registrant requirements involving unpaid wages. The Labor Commissioner may reduce the amount of a bond or cash deposit required by this section upon proof of partial satisfaction of the requirements imposed by a final judgment issued by a court, a final order issued by the Labor Commissioner, or an accord involving unpaid wages.

In addition, the Labor Commissioner is required to suspend the license of a farm labor contractor or the registration of a garment manufacturer who violates provisions of law. It does not apply when obligations have been discharged in a bankruptcy proceeding.