Bill Would Authorize Pre-Judgment Wage Liens On Real And Personal Property Of Employers And Third Parties

I often say that to be an employer in California is to be sued.  California is litigious and its labor (and other) laws are maddingly complex.  Last spring, Assembly Member Bonnie Lowenthal submitted a bill, AB 1164, that would add to the woes, not just of employers, but also of any person who has property upon which an employee has “bestowed labor”.  This bill would allow an employee to file a pre-judgment lien for the full amount of any wages, other compensation, and related penalties and damages owed to the employee.

It’s hard to imagine any property owner who at some time doesn’t have third party employees performing work on their property.  For example, a building owner may contract with a third party for window washing service.  If enacted, the bill would allow any employee of the contractor to lien the building owner’s real and personal property.  Of course, a building owner or other business is likely to have scores of contractors performing labor and thus could face a continuing barrage of employee liens.

Homeowners are allowed limited exemptions.  In the case of an employer, the lien would apply to the employer’s principal residence only to the extent that the employee provided labor to the benefit of that household or residence.  In the case of third party owners, the lien does not apply to a claim relating to property bought or services furnished primarily for personal, family, or household purposes, including those benefitting any real property that is the principal residence of the owner.

Importantly, the proposed employee lien would lack many of the limitations and procedural safeguards that apply to mechanics liens.  If enacted, I foresee an ocean of misery for California property owners, including interference with financings and costly litigation to remove liens.  For those inclined to worry about AB 1164 only if it should become law, that doesn’t appear to be unlikely.  It has already passed out of three committees in the Assembly (Judiciary, Labor & Employment, and Appropriations).


Written by:

Published In:

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

© Allen Matkins Leck Gamble Mallory & Natsis LLP | Attorney Advertising

Don't miss a thing! Build a custom news brief:

Read fresh new writing on compliance, cybersecurity, Dodd-Frank, whistleblowers, social media, hiring & firing, patent reform, the NLRB, Obamacare, the SEC…

…or whatever matters the most to you. Follow authors, firms, and topics on JD Supra.

Create your news brief now - it's free and easy »

All the intelligence you need, in one easy email:

Great! Your first step to building an email digest of JD Supra authors and topics. Log in with LinkedIn so we can start sending your digest...

Sign up for your custom alerts now, using LinkedIn ›

* With LinkedIn, you don't need to create a separate login to manage your free JD Supra account, and we can make suggestions based on your needs and interests. We will not post anything on LinkedIn in your name.