Utah Payment of Wages Act Statute of Limitations

7
34-28-2
34-28-9.5
0
Utah Payment of Wages Act Statute of Limitations
2026 GENERAL SESSION
STATE OF UTAH
Chief Sponsor: Keven J. Stratton
House Sponsor: Karianne Lisonbee
LONG TITLE
General Description:
This bill modifies the private cause of action for the payment of wages.
Highlighted Provisions:
This bill:
defines terms;
enacts a two-year statute of limitations for a lawsuit against an employer under the Utah
Payment of Wages Act; and
makes technical and conforming changes.
Money Appropriated in this Bill:
None
Other Special Clauses:
None
Utah Code Sections Affected:
AMENDS:
34-28-2
, as last amended by Laws of Utah 2018, Chapter 386
34-28-9.5
, as last amended by Laws of Utah 2024, Chapter 158
Be it enacted by the Legislature of the state of Utah:
Section 1. Section
34-28-2
is amended to read:
34-28-2
. Definitions -- Unincorporated entities -- Joint employers -- Franchisors.
(1)
As used in this chapter:
(a)
"Commission" means the Labor Commission.
(b)
"Division" means the Division of Antidiscrimination and Labor.
(c)
(i)
"Employer" means the same as that term is defined in 29 U.S.C. Sec. 203.
(ii)
"Employer" does not include an individual who is not
:
an executive.
(d)
"Executive" means an individual who is:
(A)
(i)
an officer;
(B)
(ii)
a manager of a manager-managed limited liability company;
(C)
(iii)
a member of a member-managed limited liability company;
(D)
(iv)
a general partner of a limited partnership; or
(E)
(v)
a partner of a partnership.
(d)
(e)
"Federal executive agency" means an executive agency, as defined in 5 U.S.C.
Sec. 105, of the federal government.
(e)
(f)
"Franchise" means the same as that term is defined in 16 C.F.R. Sec. 436.1.
(f)
(g)
"Franchisee" means the same as that term is defined in 16 C.F.R. Sec. 436.1.
(g)
(h)
"Franchisor" means the same as that term is defined in 16 C.F.R. Sec. 436.1.
(h)
(i)
"Unincorporated entity" means an entity organized or doing business in the state
that is not:
(i)
an individual;
(ii)
a corporation; or
(iii)
publicly traded.
(i)
(j)
"Wages" means the amounts due the employee for labor or services, whether the
amount is fixed or ascertained on a time, task, piece, commission basis or other
method of calculating such amount.
(2)
(a)
For purposes of this chapter, an unincorporated entity that is required to be
licensed under
Title 58, Chapter 55, Utah Construction Trades Licensing Act
, is
presumed to be the employer of each individual who, directly or indirectly, holds an
ownership interest in the unincorporated entity.
(b)
Pursuant to rules made by the commission in accordance with
Title 63G, Chapter 3,
Utah Administrative Rulemaking Act
, an unincorporated entity may rebut the
presumption under Subsection
(2)(a)
for an individual by establishing by clear and
convincing evidence that the individual:
(i)
is an active manager of the unincorporated entity;
(ii)
directly or indirectly holds at least an 8% ownership interest in the unincorporated
entity; or
(iii)
is not subject to supervision or control in the performance of work by:
(A)
the unincorporated entity; or
(B)
a person with whom the unincorporated entity contracts.
(c)
As part of the rules made under Subsection
(2)(b)
, the commission may define:
(i)
"active manager";
(ii)
"directly or indirectly holds at least an 8% ownership interest"; and
(iii)
"subject to supervision or control in the performance of work."
(d)
The commission by rule made in accordance with
Title 63G, Chapter 3, Utah
Administrative Rulemaking Act
, may establish a procedure, consistent with Section
34-28-7
, under which an unincorporated entity may seek approval of a mutual
agreement to pay wages on non-regular paydays.
(3)
For purposes of determining whether two or more persons are considered joint
employers under this chapter, an administrative ruling of a federal executive agency may
not be considered a generally applicable law unless that administrative ruling is
determined to be generally applicable by a court of law, or adopted by statute or rule.
(4)
(a)
For purposes of this chapter, a franchisor is not considered to be an employer of:
(i)
a franchisee; or
(ii)
a franchisee's employee.
(b)
With respect to a specific claim for relief under this chapter made by a franchisee or
a franchisee's employee, this Subsection
(4)
does not apply to a franchisor under a
franchise that exercises a type or degree of control over the franchisee or the
franchisee's employee not customarily exercised by a franchisor for the purpose of
protecting the franchisor's trademarks and brand.
Section 2. Section
34-28-9.5
is amended to read:
34-28-9.5
. Private cause of action.
(1)
Except as provided in Subsection
(2)
, for a wage claim that is less than or equal to
$10,000, the employee shall exhaust the employee's administrative remedies described
in Section
34-28-9
and rules made by the commission under Section
34-28-9
before the
employee may file an action in a court with jurisdiction under
Title 78A, Judiciary and
Judicial Administration
.
(2)
An employee may file an action for a wage claim in a court without exhausting the
administrative remedies described in Section
34-28-9
and rules made by the commission
under Section
34-28-9
if:
(a)
the employee's wage claim is over $10,000;
(b)
(i)
the employee's wage claim is less than or equal to $10,000;
(ii)
the employee asserts one or more additional claims against the same employer;
and
(iii)
the aggregate amount of damages resulting from the claims described in this
Subsection
(2)(b)
is greater than $10,000; or
(c)
(i)
in the same civil action, more than one employee files a wage claim against
an employer; and
(ii)
the aggregate amount of the employees' combined wage claim is greater than
$10,000.
(1)
(a)
Except as provided in Subsection (2), an employee may only file a claim for a
wage claim under this chapter that is less than or equal to $10,000 in accordance with
Section 34-28-9 and rules the commission makes in accordance with Title 63G,
Chapter 3, Utah Administrative Rulemaking Act.
(b)
After complying with Subsection (1)(a), an employee may only file a petition for
judicial review in accordance with Section 63G-4-402.
(2)
For a wage claim under this chapter, an employee may only file an action in a court with
jurisdiction, if:
(a)
the employee's wage claim is over $10,000;
(b)
(i)
the employee's wage claim is less than or equal to $10,000;
(ii)
the employee asserts one or more additional claims against the same employer;
and
(iii)
the aggregate amount of damages resulting from the claims described in this
Subsection (2)(b)(ii) is greater than $10,000; or
(c)
(i)
in the same civil action, more than one employee files a wage claim against an
employer; and
(ii)
the aggregate amount of the employees' combined wage claims is greater than
$10,000.
(3)
An employee may only file a wage claim in a court with jurisdiction against an
employer under this section for two years after the day on which the employee earns the
wages.
(3)
(4)
In an action under this section, the court may award an employee:
(a)
actual damages;
(b)
an amount equal to 2.5% of the unpaid wages owed to the employee, assessed daily
for the lesser of:
(i)
the period beginning the day on which the court issues a final order and ending the
day on which the employer pays the unpaid wages owed to the employee; or
(ii)
20 days after the day on which the court issues a final order; and
(c)
a penalty described in Subsection
34-28-5(1)(c)
, if applicable.
Section 3.
Effective Date.
This bill takes effect on
May 6, 2026
.
3-6-26 9:37 PM