EMPLOYEE RENT CREDITS

Wage Order 5 places maximum amounts an employer can credit towards the wages they owe employees required to live on their premises, and employees not required to live on premises to the extent the rent credit is credited towards minimum wage that must be paid for every hour worked. For example, highly paid residential managers earning $4,500 a month cannot have more than $621.29 charged as a rent credit if they manage an upscale 80 unit building managed by an employer with 10,000 employees. In the case of minimum wage, an employee required to work 20 hours a week on premises cannot be paid nothing for those hours because they receive a $1,250.00 a month apartment. That employee would be entitled to at least minimum wage for each hour worked offset by $621.29-$593.05 a month if they were single. The maximum an employer can charge for rent credits depending on whether it is a couple or single person.


In 2018 employers who required their employees to live on their premises could not charge single employees more than $621.29-$593.05 a month for rent. Couples cannot be charged more than $919.04-$877.26.

The amount employers can charge their employees to live on their premises is based upon the number of employees the employer has with 25 or fewer employees subjecting the employer to the smaller figures, and employers with 26 or more employees being able to take the larger credit. If the employee is not required to live on the premises, the employer’s rent credits can only be credited against minimum wage for the amounts listed above. All of the above credits cannot equal more than 2/3 the reasonable rental value of an apartment. For instance, if the apartment is only worth $1,000 a month the employer cannot receive $792.00 in wage credits from the employee even if it is a couple who could otherwise be charged up to $919.04 a month.

IF YOUR EMPLOYER IS NOT PAYING YOU WAGES, BUT IS PROVIDING A RENT CREDIT THAT YOU THINK IS EXCESSIVE UNDER THE LAW CONTACT OUR EMPLOYEE LAWYERS AT 1-877-525-0700 UNLAWFUL EMPLOYEE RENT CREDITS CAN LEAD TO LABOR LAW VIOLATIONS

Besides employers not being entitled to rent credits beyond the amounts listed in Wage Order 5, an employer who thinks they can overpay an employee through rent credits may have engaged in minimum wage, overtime, double time, and almost certainly paystub violations. The fundamentals of labor law require nonexempt employees to be paid for every hour they work. Their pay must be at least minimum wage. Many property management companies attempt to entirely cover the cost of the employee’s labor on their property by paying them a rent credit. Presume a $621.29 a month rent credit is allowed, but the employee has worked 80 hours for the employer and is given a $1,500 a month apartment. Presume minimum wage is $12.00 an hour. The employee should be paid $960.00. After the rent credit they are still owed $338.61 in wages. If the same employee worked 20 of the 80 hours as overtime because he worked many 10 hour days the 20 hours would have to be compensated at an overtime rate.

If an employer fails to furnish any paystub showing the rent credit they have committed a paystub violation. If the paystub charges more than the lawfully allowed amount for rent credits a paystub violation has occurred. If the employer incudes a rent credit that is too high as the amount of wages being paid, a paystub violation has occurred.

California Labor Code Section 226 requires paystubs to include the employee’s correct hourly rates, including those for overtime and/or double time, accurate gross and net wages earned, and the correct itemized deductions for rental credits. California Labor Code Section 226 requires employers to provide all rates of pay for employees. This means their correct hourly rate must be included on the paystub. It also means the correct overtime and double time rates must be on the employee’s paystubs. If a rate of pay has been changed due to a rent credit or piece rate work the rate of pay must reflect those unusual circumstances. Each paystub that fails to furnish any of the above information correctly may lead to a $100 fine per paystub the employee can recover from their employer.

ATTORNEYS FOR EMPLOYEES IN PROPERTY MANAGEMENT

Allow the Employment Lawyers Group to view your paystubs in order to determine if your employer properly reported your rates of pay. Did you receive pay for each hour you worked? Were you paid at the correct hourly rate? If you were not required to live on your employers’ premises were you paid for being on-call? Were you reimbursed for driving around for your employer? Were you properly paid all bonuses your employer offered to pay you as a property manager, or maintenance employee? All of these things have come up in employee lawsuits we have filed.

Examples of property management lawsuits we have prevailed in include:

• A maintenance employee not paid mileage for driving his truck. He quit and sued
• A property manager complained overtime was not received and the correct hours worked were not on her paystubs. She sued for wrongful termination and received $250,000
• A maintenance employee at an apartment building was forced to work many hours he was not compensated for. He only received a rent credit

The Employment Lawyers Group has offices throughout California. In Los Angeles County we have offices in Downtown Los Angeles, Sherman Oaks, and Torrance. In the Inland Empire we have an office in Ontario and Riverside. In Southern California we have offices in Oxnard, Bakersfield, and Tustin.

We have represented more than 500 individual workers in wage claims, and many thousands in class actions in order to collect wages. Please feel free to contact the Employment Lawyers Group, Riverside if you have a question about wages owed to you regardless of whether you are a property manager.

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1-877-525-0700

ALTHOUGH THIS ARTICLE CONTAINS LEGAL INFORMATION IT CAN ALSO BE CONSTRUED AS AN ADVERTISEMENT FOR LEGAL SERVICES