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Legal Insider: Virginia Passes Bill to Allow Workers to Sue for Unpaid Wages and Damages

This is a sponsored column by attorneys John Berry and Kimberly Berry of Berry & Berry, PLLC, an employment and labor law firm located in Northern Virginia that specializes in federal employee, security clearance, retirement and private sector employee matters.

By John V. Berry, Esq.

Virginia employees, if House Bill 123 is signed by Governor Ralph Northam or not otherwise acted upon by April 6, 2020, will have new rights to wages that are unlawfully unpaid.

Virginia House Bill 123 has been passed by both the Virginia House and Senate. The new legislation would create a private right of action for collecting unpaid wages in Virginia. House Bill 123 allows employees that have not been paid to sue an employer to recover their pay, in addition to damages.

Details of Employer Damages and Penalties

House Bill 123 permits Virginia employees to bring claims against employers that fail to pay wages and allows them to recover the wages owed, plus 8% interest from the date that the wages were due. Employees can also be awarded triple damages (3 times the amount of unpaid wages), their attorney’s fees and other costs if a court finds that the employer knowingly failed to pay the wages.

In our experience, most employers are aware that they did not pay wages owed to an employee. There is also a $1,000 civil penalty against the employe for a violation.

Example: Under the law, for example, if an employer fails to pay an employee $1,000 that they earned, they could be liable for that amount, plus 8%, potentially 3 times the wages that were not paid, along with attorney’s fees incurred by the employee, and a civil penalty.

The $1,000 that was unpaid could easily become a judgment against the employer for $5,000 to $8,000 by the time damages and fees are included. Then the civil penalty would also need to be added. If a court finds that there is a genuine dispute between an employer and employee, the employer would not be required to pay triple damages.

Criminal Penalties for Employer Apply

There are also criminal law penalties in the new law. Employers could be found guilty of a misdemeanor, punishable by up to 12 months in jail, if the wages owed are less than $10,000. Employers are to be considered guilty of a felony, punishable by a prison term of up to five years, if the value of wages owed is at least $10,000 or if the employer previously had been convicted of such a violation.

Criminal liability now only applies if the nonpayment of wages was willful with the intent to defraud. If signed by the Governor or allowed to become law, the legislation would take effect July 1, 2020.

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