How to appeal a certified payroll penalty in California
You have 60 days from service of the assessment to request a hearing, or it becomes final. The process is called a Request for Review, it runs under Labor Code section 1742, and here is every step of it.
What you actually received
What gets called a "certified payroll penalty" in California is almost always one of two documents. The first is a Civil Wage and Penalty Assessment. Under Labor Code section 1741, the Labor Commissioner issues this after finding a violation anywhere in the public works chapter, reaching the $100 per worker per day forfeit for missing a records request under Labor Code 1776 (more on that statute in our subdivision by subdivision guide), the per diem wage penalty under Labor Code 1775, and the $100 per day eCPR filing penalty, capped at $5,000 per project, under Labor Code 1771.4. The second is a Notice of Withholding of Contract Payments. Under Labor Code section 1771.6(a), the awarding body issues this when it enforces the chapter directly under section 1726 or 1771.5, rather than leaving enforcement to DLSE. Title 8, California Code of Regulations, section 17220, names a notice assessing 1776 penalties specifically as one document this process covers. One appeal path, one deadline, covers both.
The 60 day deadline, and why it is not flexible
Section 1742(a) gives you 60 days after service of the assessment to transmit a written request for review to the office named on the assessment. Miss it, and the statute says plainly: "the assessment shall become final." Section 17222(a) of the regulations repeats the same rule for a Notice of Withholding.
This is not a formality the Director waives for a good excuse. In a 2019 decision, the Director dismissed a contractor's Request for Review filed 104 days after service, holding the 60 day window "mandatory and jurisdictional" and citing Pressler v. Donald L. Bren Co. (1982) 32 Cal.3d 831 for the rule that a late filing "may not be excused on the grounds of mistake, inadvertence, or excusable neglect." (Case No. 19-0242-PWH, Department of Industrial Relations.) Code of Civil Procedure section 1013(a) adds 5 calendar days to a deadline when the document that starts it was served by mail within California. Footnote 2 of the same 2019 decision applied that extension here, treating the 65th day after the assessment date as the outer limit for a mailed assessment. Count from the date on the assessment, add 65 calendar days if it was served by mail, and treat that as your real deadline. Nothing about a pending audit or an ongoing conversation with a compliance investigator moves this date.
Before you file: a 30 day settlement window
You do not have to go straight to a hearing. Section 17221 gives you 30 days from service of the assessment to request a settlement meeting with the enforcing agency, in person or by phone. It does not stop the 60 day clock: section 17221(d) says requesting, holding, or even the agency refusing a meeting does not extend the time for filing a Request for Review. It is confidential, too. Section 17221(e) makes anything said or written for the meeting inadmissible in the hearing that follows. Use it if the assessment looks like a computation error the agency will fix without a fight, but file the Request for Review regardless of how the meeting goes.
How to file the Request for Review
Under section 17222, the request is a letter, not a form:
- Send it to the office named on the assessment. Section 17222(b). For DLSE assessments this is typically the Civil Wage and Penalty Assessment Review Office, PO Box 32889, Long Beach, CA 90832, per the notice language quoted in DIR's own published decisions.
- Identify the assessment. Include its date, or attach a copy. Section 17222(e).
- State your basis for contesting it. The regulation is liberally construed in your favor, but the hearing officer can require you to specify the issues. A one line "I disagree" is enough to file; it is not enough to win.
- Get it postmarked or received by day 60. Section 17222(c) treats the request as filed on the earlier of the postmark date or the date the agency receives it.
Keep a copy and proof of mailing. The 2019 decision above turned entirely on dated exhibits of when the assessment was served and when the response went out.
What happens after you file
| Step | Deadline | Source |
|---|---|---|
| Enforcing agency transmits your request and the assessment file to the Director's Legal Unit | 10 days after receiving it | 17223 |
| Agency discloses the evidence it plans to use at the hearing, including witnesses | 20 days after receiving your request | 17224 |
| Hearing commences before an appointed hearing officer | Within 90 days of your request | Labor Code 1742(b) |
| Director issues a written decision affirming, modifying, or dismissing the assessment | Within 45 days of the hearing's conclusion | Labor Code 1742(b) |
| Director may correct an error in the decision on their own motion | Within 15 days of the decision | Labor Code 1742(b) |
| You may petition the superior court for a writ of mandate | Within 45 days of the decision, or it becomes final | Labor Code 1742(c) |
The hearing officer cannot be a DLSE employee, the agency that issued the assessment (Labor Code 1742(b)). And if the agency misses its 20 day evidence disclosure deadline, section 17224(d) blocks it from introducing that evidence at the hearing at all.
Who has to prove what
Section 17250 splits the burden of proof in a specific order. The enforcing agency goes first and only has to show three things: that you were properly served, that you got the evidence disclosure required under section 17224, and that its evidence gives "prima facie support" for the assessment. That is a low bar. Once the agency clears it, the burden shifts to you: you have to prove the assessment is wrong. For a wage rate penalty under Labor Code 1775 specifically, the standard is narrower still: you have to show the Labor Commissioner abused their discretion in deciding a penalty was owed or in setting the amount, per section 17250(c).
In practice you need your own evidence: certified payroll records, the wage determination in effect on your award date, proof of when records were requested and produced, and, for a 1775 penalty, whatever shows the underpayment was a good faith, promptly corrected mistake rather than a pattern.
What an appeal does not do while it is pending
Filing a Request for Review does not release money already being withheld. Labor Code 1771.6(c) requires the awarding body to hold withheld contract payments until there is a final order or the review period has run. An appeal is how you get money back on a win, not a way to unfreeze it now. If the frozen payment is the emergency, work that on a separate track: get current filings in, and where the assessment stems from a records request, produce what was asked for. Our guides to the 10 day records request rule and catching up on certified payroll cover that track.
If you lose the hearing
The Director's decision is not the end of the road, but the next step is a court filing, not another agency letter. Under Labor Code 1742(c), you have 45 days after service of the decision to file a petition for a writ of mandate in superior court under Code of Civil Procedure section 1094.5, or the order becomes final. On a challenge to the findings, the court asks whether they are supported by substantial evidence in light of the whole record. Once an order is final and no longer subject to review, Labor Code 1742(d) lets the Labor Commissioner file a certified copy with the superior court clerk, who enters it as a judgment against you, carrying the same interest and priority as a judgment for unpaid taxes (Labor Code 1742(e)).