What You Should Know About Car Wash Businesses

Written by Galen T. Shimoda, Jennet F. Zapata, and Erika R. C. Sembrano

Employees at car washing and polishing businesses (e.g., businesses that provide washing, cleaning, drying, polishing, detailing, and other cosmetic care to vehicles) are often not paid for all hours worked. For these types of companies, employees might be paid based on the number of cars washed or detailed. However, employers do not always ensure that employees are paid for every hour worked, including overtime hours (over eight (8) hours in a day or forty (40) hours in a week). Because these violations are not unusual in this industry, car washing and polishing businesses are required to comply with certain registration obligations that protect employees. The Labor Commissioner, a California government entity, has the authority to enforce the regulations pertaining to these types of businesses.

Every year, car washing and polishing businesses must register with the Labor Commissioner by filling out a written application, paying a registration fee for each branch location, and posting a $150,000.00 bond (which the Labor Commissioner can use if the business fails to pay its employees all wages earned). If a company fails to register properly, it cannot conduct any business. If the company continues operations while unregistered, it will be subject to a civil fine of one hundred dollars ($100.00) for each calendar day that it performs car washing and polishing, up to a maximum of $10,000.00. The Labor Commissioner can also decide not to renew the registration for the company.

When a business properly registers itself, it will receive a proof of registration. The business must then post the registration in each registered branch of operation so that it can be read by employees during the workday. Conveniently, on the Department of Industrial Relations' website, the Labor Commissioner posts a list of registered car washing and polishing businesses, including their name, address, registration number, and effective dates of registration. If the car washing and polishing business you are working for is not found on the website, it may be subject to the fines described above.

Car washing and polishing businesses must also maintain accurate records of its employee for three (3) years. The records must include, among other things, names and addresses of all employees, hours worked daily (including beginning and end times), all gratuities (e.g., tips) received by the employer, and wages paid each pay period. The Labor Commissioner may request these records, and if the business fails to provide the requested records in a timely manner (or if the records are falsified), this can be a basis for suspending or revoking the business' registration.

This oversight of car washing and polishing businesses sheds light on the potential wrongful pay practices. As mentioned above, car washing and polishing businesses do not always pay employees all wages earned. It is actually common for car washing and polishing businesses to use a piece-rate system (e.g., being paid based on how many cars the employee works on), but this system does not necessarily mean that employees are being paid properly. For example, if an employee has to wait twenty (20) minutes in between different cars to work on, the employer must be sure that the employee is being paid for that waiting time. Also, if an employee works over eight (8) hours a day, then the employee must be paid appropriate overtime compensation. (In this scenario, it comes as no surprise that employers are required to keep a record of daily hours worked.) As another general example, California employees are entitled to paid rest breaks of at least ten (10) minutes for every four (4) hours worked. If the company only pays the employee by the number of cars worked on, the company probably does not make sure that it also pays for the required ten (10) minute rest breaks. The list goes on.

Overall, car washing and polishing businesses need to ensure that 1) they are properly registered in California; and 2) they are paying their employees correctly. If not, civil liability arises.

If you work for a car wash (registered or not) and have not been paid for all wages earned, please contact our office . to speak with an attorney.

 

The Shimoda Law Corp. legal articles should not be construed as legal advice or a legal opinion on any specific facts or circumstances. The contents of these articles are intended for general information purposes only, and you are urged to consult a lawyer concerning your own situation and any specific legal questions you may have.

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