Wage Theft at Small Businesses: Enforcement When the Employer Has No Assets

Many wage theft victims work for small businesses — restaurants, retail shops, small contractors — that may have limited assets. Understanding how to enforce a judgment against a small employer requires knowing what assets are reachable.

Reachable Assets

Small business assets include: business bank accounts (subject to levy), equipment and inventory (subject to writ of execution), accounts receivable from customers, the business owner’s personal assets if they personally guaranteed obligations or if the corporate form is disregarded, and any real property owned by the business entity.

PAGA is particularly valuable against small employers. Per-employee per-period penalties under PAGA accumulate regardless of the employer’s size. An employer with 10 employees who violated the law for 52 pay periods may owe $50,000+ in PAGA penalties — more than their annual revenue in some cases. The threat of PAGA penalties motivates settlement even from small employers with limited assets.

The California Wage Theft Recovery System gives workers the exact tools and templates to document violations, calculate what they’re owed, and file the right claims. Request your free evaluation here.