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California Supreme Court Issues Significant Decision In Favor Of California Retirees

Sacramento, CA – August 18, 2016 – Today, the California Supreme Court filed a published opinion confirming that California retirees are entitled to prompt pay protections under California law.  The case, McLean v. State of California, et al., was brought by a former California state employee who retired from employment at the Attorney General’s Office and alleged violations under Labor Code sections 202 and 203 based on the State of California’s failure to pay timely final wages and tender payments to retirement accounts within statutorily-mandated timeframes upon her retirement.  The State argued that the relevant prompt pay statutes under the Labor Code applied to employees who were “discharged” or “quit,” not to “retirees.”  Plaintiff disagreed, arguing that California’s prompt pay protections also extend to those who “retire.”  William A. Kershaw, of Sacramento-based law firm Kershaw Cook & Talley PC, argued before the Supreme Court on behalf of the plaintiff and putative class.  The issue was previously appealed to the Third District Court of Appeal, where the court of appeal agreed that the protections afforded under Labor Code sections 202 and 203 also protect retirees.  The court of appeal also determined that the State of California was properly sued as plaintiff’s “employer.”

The California Supreme Court affirmed the court of appeal’s judgment in its entirety.  The Supreme Court held that prompt pay protections “apply to persons who retire from their employment, just as they apply to those who voluntarily leave their employment for other reasons.”  In doing so, the Court also emphasized California’s long-standing policy of construing wage and hour laws to protect workers, re-iterated California’s “fundamental public policy regarding prompt wage payment” and expressly found that the “statutory policy favoring prompt payment of wages applies to employees who retire, as well as those who quit for other reasons.”  The Supreme Court also confirmed that the State of California is a proper defendant in the case.

The decision represents a significant victory for California retirees and establishes that they should not be denied prompt pay protections under California law.

For further information regarding the California Supreme Court’s decision or the McLean v. State of California matter, please contact William A. Kershaw at 916-779-7000.

*Kershaw, Cook & Talley is a plaintiffs’ complex litigation and personal injury law firm in Sacramento, California, representing individuals and businesses nationwide.

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