Amend Fund To Allow Payment Overdue Wage Claims

Starting April 1, 2024, the act allows the division of labor standards and statistics (division) in the department of labor and employment (department) to use money in the wage theft enforcement fund (fund) to pay employees who are owed money from their employers due to obligations and liabilities related to the payment of wages or other compensation. The division may pay an employee if an employer fails to fulfill an order by the division to pay the employee that results from a wage claim or an investigation:

• Within 6 months after the division issues a citation and notice of assessment to the employer; or
• If the employer requests a hearing, within 6 months after the hearing officer issues a decision.

The act specifies that after the division pays the employee:

• The employee cannot recover that payment amount from the employer;
• The division replaces the employee as creditor and shall continue to pursue the payment from the employer; and
• Any money recovered from the employer by the division will be credited to the fund.

The act requires the division to promulgate rules specifying procedures and criteria for employees to request payments and for the division to make determinations on employee requests.

The act continuously appropriates money in the fund to the division for the purpose of making payments to employees for unpaid liabilities, but for purposes of the division's direct and indirect costs implementing wage laws, the money in the fund is subject to annual appropriation by the general assembly. The act excludes the fund from the limit on cash fund reserves. For the 2023-24 state fiscal year, the act appropriates $12,657 from the fund to the department for use by the department's office of the executive director for personal services.

APPROVED by Governor April 17, 2023

EFFECTIVE April 17, 2023
(Note: This summary applies to this bill as enacted.)