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Brown Files $6-Million Lawsuit Against Eight Car Washes for Failing to Pay Workers

Monday, October 4, 2010
Contact: (415) 703-5837, agpressoffice@doj.ca.gov

LOS ANGELES - Attorney General Edmund G. Brown Jr. has filed a $6.6 million lawsuit against eight car washes after an investigation revealed a 'widespread pattern of worker exploitation,' unpaid wages and illegal business practices.

“The owners routinely denied wages, breaks and overtime pay to workers at their unlicensed car washes,' Brown said. 'This lawsuit seeks to end this widespread pattern of worker exploitation.'

Brown's lawsuit caps a five-month investigation of eight car washes in Fair Oaks, Folsom, Irvine, Laguna Hills, Laguna Niguel, Santa Monica, San Ramon and Venice.

Investigators interviewed more than 80 workers and found the car washes routinely denied workers minimum wage and overtime, failed to pay wages owed to those who quit or were terminated, denied rest and meal breaks, and created false records of time worked.

The car washes required employees to report to work hours early and be available, unpaid, until business picked up. When workers were paid, many received paychecks that could not be cashed because of insufficient company funds. Additionally, the car washes operated for years without licenses from the Labor Commissioner, which are required under California law.

Brown's lawsuit was filed against eight car washes and Dipu Haque, aka Dipu Haque Sikder, who spearheaded the operation. The suit alleges that the car washes violated California Business & Professions Code section 17200 and Labor Code sections 203 and 203.1, seeks $6.6 million to pay back lost wages and civil penalties, and an injunction to prevent the defendants from committing similar violations in the future.

Sergio Diaz-Esquivel and Juvenal Diaz-Esquivel worked for the Wash & Go Hand Wash in Irvine during 2005 and 2006. They quit because of the poor working conditions. They worked seven days per week and were not paid for all the hours they worked, nor paid the overtime wages due to them. After they quit, Wash & Go Hand Wash continued to refuse to pay them, which forced the workers to go to the Labor Commissioner. In August, 2007, they obtained judgments totaling $14,708.24, including penalties for the car wash's willful failure to pay them their wages. The car wash still has not paid them.

The car washes also owe more than $1.8 million in unpaid taxes, according to recorded liens.

The eight car washes named in today's lawsuit are:

- Bonus Car Wash located at 2800 Lincoln Blvd. in Santa Monica
- Crown Valley Car Wash located at 25991 Crown Valley Parkway in Laguna Niguel
- Gold Rush Auto Spa located at 7620 Folsom-Auburn Blvd. in Folsom
- Gold Rush Auto Spa II located at 4350 Sunrise Blvd. in Fair Oaks
- Laguna Hills Union 76 Station [Car Wash] located at 24795 Alicia Parkway in Laguna Hills
- Marina Car Wash located at 2305 Lincoln Blvd. in Venice
- Sponges Car Wash located at 2061 Camino Ramon in San Ramon
- Wash & Go Hand Wash (also known as Wash & Go Hand Carwash Corp and Irvine Auto Spa) located at 3080 Main St. in Irvine

This lawsuit follows another suit filed late last year by the Attorney General against Los Angeles-based Auto Spa Express Car Wash, which forced employees to work nearly 60-hour weeks without overtime, ignored minimum wage laws, and denied injured employees' their workers' compensation benefits.

Brown continues to crack down on businesses that abuse and exploit workers and violate California law to gain a competitive advantage. Already this year, Brown's Underground Economy Unit has:

- Won back pay for more than 200 construction workers denied fair wages by a Bakersfield-based drywall company.
- Sued a farm labor contractor in Southern California that failed to provide rest breaks, drinking water or shade to field workers.
- Won a $3.9 million settlement from a Livermore-based construction company that falsified payroll records, misclassified workers to reduce workers' compensation premiums and violated the state's prevailing wage laws, including an award of $2.2 million for unpaid wages.
- Won a lawsuit against a Southern California trucking company that misclassified port-based truck drivers and failed to pay state taxes, contribute to Social Security and Medicare, or provide W-2 forms to its employees.

California's 1,500 car washes employ a total of 28,000 workers per month, according to recent California Employment Development Department figures. One third of these car washes are unlicensed, according to a 2008 report by the state Labor Commissioner, and have not posted a bond to ensure payment of wages, as required by law.

A copy of today's complaint, filed in Los Angeles County Superior Court, is attached.

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PDF icon Car Wash Complaint425.47 KB

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