California Car Washes Soaked with $771,050 in Citations

Investigators from the California Labor Commissioner’s Office issued more than $700,000 in fines to businesses in the car wash industry in a two day statewide enforcement sweep. The penalties included a total of $500,100 issued to 65 unlicensed car wash businesses that were cited for not having a registration.

“Registration requirements provide safeguards for businesses that operate within the law by allowing us to focus on those businesses do not, making it difficult for legitimate car wash businesses to stay in operation,” said California Labor Commissioner Angela Bradstreet. “The requirements also provide added protections for workers in the industry as we can better monitor businesses that are not following the laws.”

The two day enforcement sweep involved 247 car wash inspections and resulted in the issuance of 129 citations against 96 car wash businesses with citations issued totaling $771,050.

Investigators found 54 businesses that failed to provide workers’ compensation coverage for their employees. Citations issued for no workers’ compensation totaled $238,000 and businesses without coverage were issued stop work orders, which prevents them from operating with employee labor.

Also found during the investigations were six cases where the employer did not provide employees a wage deduction statement, one case of improper payment of minimum wage and one case of improper payment of overtime. Two businesses were found to have hired minors without having the required work permits on file.

“The law requiring car wash businesses to be registered was extended to 2014 allowing us to better monitor situations where we have traditionally seen labor violations,” Bradstreet said. “As part of the underground economy, illegal businesses often do not pay state taxes and take advantage of employees by not providing workers’ compensation coverage or paying proper wages.”

For the year 2009, enforcement efforts resulted in 623 car wash establishment inspections/re-inspections and the issuance of 469 citations for violations of various labor laws including non-registration and penalty assessments in the amount of $3,098,050. In addition, $311,325 was collected on behalf of workers as wages due.

To request a list of the violations and businesses cited during the enforcement action, e-mail the Department of Industrial Relations at Communications@dir.ca.gov. A list of all car wash businesses currently registered with California is available on DIR’s website at the following link: http://www.dir.ca.gov/dlse/HowToObtainCarWashRegistration.htm.

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