HB 2579 became effective August 6, 2016, making sweeping changes not only to preempt local governments from enacting their own living wage or fringe benefits ordinances for private employers but also redefining what legally constitutes a “wage.” Prior to this amendment, Arizona state law defined “wages” as including sick pay, vacation pay, severance pay and other discretionary and nondiscretionary amounts, including bonuses, that an employer has a policy or practice of making. This could include reimbursement of business expenses or other amounts that had previously been included in the definition of “wages” under the statute which requires timely payment upon cessation of employment. The narrowing and redefining of wages, striking from the definition “sick pay, vacation pay, commissions, bonuses, and other amounts promised that the employer had a policy or practice of paying” will limit an employee’s ability to go after employers for these monies. An employee who is not timely paid earned but unpaid vacation pay, earned bonuses, or other amounts, the employer had a policy or practice of paying, is now precluded from seeking treble damages under the wage statute.

Faulkner Law Offices, PLLC can help you navigate the wage law changes.