Within days of each other, the governors of New Mexico and Iowa signed legislation that significantly increases the penalties for wage and hour violations in those states. The New Mexico statute also creates new causes of action.

On April 6, 2009, the governor of New Mexico signed House Bill 489 into law. The new law becomes effective on June 19, 2009. HB 489 amends the state Minimum Wage Act to prohibit employers from retaliating against employees for filing claims or asserting rights under the law, for helping someone else pursue a claim, or for notifying someone else about their legal rights.

HB 489 also lengthens the statute of limitations for wage claims from one year to three years after the last violation occurs, and provides that an investigation by the Labor Relations Division of the Workforce Solutions Department tolls the statute of limitations. In addition, HB 489 contains a continuing violations provision, meaning that a civil action brought under the Minimum Wage Act may encompass all violations that are part of a continuing course of conduct, no matter when they occur.

Further, HB 489 increases the criminal misdemeanor fine for violations of the Minimum Wage Act to $1,000 and increases the potential jail sentence to a period of up to one year. HB 489 also increases the civil monetary penalties to two times the amount of the unpaid wages. Finally, the bill provides for injunctive relief in civil actions, including requiring employers to post a notice describing the violations or a copy of the cease and desist order in the workplace.

Similarly, on April 8, 2009, the governor of Iowa signed House File 618 into law. HF 618 establishes new penalties for certain wage violations, increases other penalties and modifies provisions related to child labor.

First, HF 618 increases the civil penalty for failing to pay an employee’s wages from $100 to $500 per pay period.

With regard to child labor, HF 618 expands the types of documentation that can be used to show that a minor is 14 years old and therefore able to work with a work permit. The new law also loosens the standard for violations of child labor laws from “willfully” to “negligently” such that a parent, guardian, person or corporation violates the law by negligently permitting a child under 18 to work in violation of the law. HF 618 also increases certain child labor criminal penalties from simple to “serious” misdemeanors and deems other violations serious misdemeanors. Each person illegally employed and each day that a violation occurs counts as a separate offense. Lastly, HF 618 also creates a civil penalty for child labor violations of up to $10,000 and establishes procedures for the labor commissioner to administer these penalties.

This blog entry was authored by Lara K. Strauss.