Los Angeles Business Journal

Minimum Wage Violations Withdrawn Against BYD

Tuesday, January 28, 2014

Minimum wage violation charges against Chinese electric vehicle manufacturer BYD Co. Ltd. were withdrawn Tuesday by the California Department of Labor Standards and Enforcement, according to the law firm representing BYD.

The company, however, still faces a hearing before the department on two other alleged technical violations, said Lanny J. Davis, principal of Lanny J. Davis & Associates, a Washington, D.C. firm specializing in crisis management.

The decision by the labor standards department, part of the state Department of Industrial Relations, was welcomed by BYD.

“We wish this had come sooner,” Davis said in a prepared statement.

Attempts to confirm with the Industrial Relations Department of the withdrawal of the minimum wage violations were not successful.

BYD, based in Shenzhen, is a high profile company in which Warren Buffet has a roughly 10 percent stake. Its BYD Coach & Bus LLC subsidiary opened its Lancaster plant in May to make electric buses for public transit agencies and its BYD Motors Inc. opened offices in Los Angeles in 2010 as the company’s North American headquarters.

The state Department of Industrial Relations began investigating BYD in late October and cited the company for not paying minimum wage, failure to provide itemized wage statements and not giving a second brief rest break. The department has already levied $99,245 in fines against the company.

BYD provided documentation showing that five temporary employees from China were paid between $12 an hour and $16 an hour, substantially higher than California’s mandatory $8 an hour, Davis said.

The labor standards department maintained that the five employees should have been paid in U.S. currency and not in renminbis, the currency of the People’s Republic of China, he added.

“While BYD disagrees with this position as a matter of law, in the spirit of resolving this matter, BYD has agreed to pay $1,900 for this alleged error,” Davis said in his statement.

The itemized wage statements violations and rest break complaints remain pending and have been denied by BYD, Davis said.