Earlier this month, Virginia Governor Ralph Northam signed into law House Bill 123, amending the Virginia Wage Payment Act to create a private cause of action for employees who are the victim of “wage theft.” This will significantly increase an employer’s liability for failing to fully compensate their employees for all hours worked.
Previously, when claiming an employer’s breach of contract or unjust enrichment, employees were limited to pursuing only the amount of wages not paid. As of July 1, 2020, however, employers in Virginia who knowingly fail to comply will not only be obligated to hand over those unpaid wages, but also statutory or “liquidated” damages OR up to triple the amount of those unpaid wages, as well as prejudgment interest (from the date the wages should have been paid) at a rate of 8% and reasonable attorney’s fees and costs. Virginia employers who fail to timely and completely pay their employees’ wages may also answer to the state, which can pursue civil penalties of up to $1,000 for each violation and, in the most serious cases, criminal penalties – with unpaid wages of less than $10,000 constituting a misdemeanor punishable by up to 12 months in jail, while unpaid wages of over $10,000 qualify as a felony punishable by up to 5 years in jail.
Joining employers in both Maryland and D.C., Virginia employers can now anticipate an increase in litigation as a result of this new law’s enhanced damages and its attorney’s fee recovery provision. Stay tuned for more “pro-employee” legislation which is anticipated from Virginia’s Democrat-controlled legislature.
Please contact us if you have any questions regarding this important change to the Virginia law, or would like to discuss this topic further.
The contents of this Alert are for informational purposes only and do not constitute legal advice. If you have any questions about this Alert, please contact the Shulman Rogers attorney with whom you regularly work or a member of the Shulman Rogers Employment and Labor Law Group.
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