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July 26, 2016

Injunction Denied in AB 1513 Safe Harbor Challenge

Following a hearing held last week, a Fresno Superior Court has denied a motion to issue a preliminary injunction against the ‘safe harbor’ provisions of the piece-rate legislation signed into law in 2015. The Nisei Farmers League filed a complaint alleging the statute is unconstitutionally vague, among other grounds.

The court determined the plaintiff did not meet its burden of showing a likelihood of prevailing on the underlying constitutional challenge. In its ruling, the court said:

“A fair reading of the statute is that, insofar as activities prior to its enactment are concerned, no new obligations were created; either employers had fully compensated their employees for their work or they had not been fully compensated. If an employer wishes to take advantage of the offered affirmative defense it must either make a good faith attempt to pay the amounts due or pay 4% of the gross earnings of the employee between July 1, 2012 and December 31, 2015… If the employer does not take advantage of the safe harbor provisions, then it may still argue that it does not owe any back pay to its employees.”

Furthermore, the court held that Nisei’s members would suffer no harm if the motion was not granted. As the court noted, “Simply put, plaintiff’s members’ obligations with respect to money owed do not appear to be changed by this statute.”

As a result of the court’s order, the deadline to elect the “safe harbor” remains until 11:59 pm PDT on July 28.

For more information contact Jason Resnick at (949) 885-2253.