For too long, California workers have been forced to fight twice, once to win a wage theft judgment and again just to collect it. That changes with Senate Bill 261 (SB 261), signed into law by Governor Newsom in October 2025 and a major victory for employee rights across the state.
The Problem: Winning Wasn’t Enough
Studies show that only about 12 percent of wage theft judgments were fully collected between 2018 and 2023. Countless California workers in restaurants, construction, hospitality, and healthcare won their cases but never saw a dime. Employers simply ignored the judgments with little consequence.
What SB 261 Does
SB 261 finally gives unpaid wage judgments real teeth. The law imposes a civil penalty of up to three times the outstanding judgment if a final wage judgment remains unpaid 180 days after the appeal period ends. Courts are also required to award reasonable attorneys’ fees and costs to prevailing plaintiffs in enforcement actions. Even better, half of any penalty collected goes directly to the affected workers themselves.
The law also closes a loophole that allowed employers to escape liability by restructuring or selling their business; successor liability now extends to penalties, so business reorganizations or sales do not erase employer obligations.
What This Means for You
If your employer has failed to pay you earned wages, overtime, or other compensation, California law is firmly on your side, and now it has stronger enforcement tools than ever before.
At Lavi & Ebrahimian, our Beverly Hills employment attorneys are dedicated to fighting for the rights of California workers. Whether you’re dealing with wage theft, unpaid overtime, or employer retaliation, we’re here to help you recover every dollar you’re owed.
Call us today at (866) 470-2189 for a free consultation. Don’t let your employer get away with wage theft. Justice is within reach.