By Andrew Edwards, March 13, 2014
State labor officials have ordered electric bus manufacturer BYD to
pay more than $30,000 in penalties after a hearing officer found the
company failed to provide employees with proper rest periods or itemized
The hearing officer working at the Office of the Labor
Commissioner upheld penalties of nearly $35,000, according to a
document bearing Tuesday’s date. The assessment of the penalties follows
a decision made earlier this year to drop allegations that BYD failed
to pay some employees a minimum wage.
BYD, which has a contract to provide electric buses to Long Beach
Transit, could have had to pay nearly $100,000 in penalties if all
allegations had been sustained.
BYD released a statement on
Thursday declaring labor issues involving the company have been
resolved. BYD described the violations as being the result of “good
faith technical errors,” such as allowing employees to take a single
20-minute break period to eat breakfast in a group each morning.
California law requires employees to grant their workers separate
10-minute breaks during an eight-hour shift.
The firm’s statement did not address the paycheck issue. BYD
paychecks did not reflect the hours worked by employees, according to
the Office of the Labor Commissioner.
The company also reported
executives were pleased that the level of fines assessed was
substantially lower than what was originally possible. The firm reported
having to pay nearly $38,000 in fines, a level higher than what
appeared to be required, according to information obtained from
The decision closes the labor commissioner’s investigation of BYD’s treatment of the workers.
Department of Industrial Relations spokesman Peter Melton wrote
in an email that BYD has the right to challenge the findings in court.
and its supporters, who include prominent Washington, D.C., attorney
Lanny Davis, proclaimed victory in late January when the labor
commissioner dropped allegations that workers were paid at rates below
the state’s minimum wage of $8 per hour.
BYD is a Chinese company
that produces batteries and battery-powered vehicles. Its North American
headquarters is in Los Angeles and the firm operates bus assembly and
battery assembly plants in Lancaster. State officials filed the
allegations against BYD after inspecting facilities in both cities in
About one year ago, the firm bested South Carolina-based Proterra
to win a $12.1 million contract to produce 10 electric buses for Long
The procurement process, however, has been
complicated by the labor commissioner’s investigation and other
problems. Testing of BYD’s coach model at The Altoona Bus Research and
Testing Center in Pennsylvania was delayed for several months after Long
Beach Transit demanded in October that tests be conducted on an
American-built bus, as opposed to the Chinese-built bus that was
initially subjected for evaluation. Federal transportation officials
decided last month to complete testing on the original Chinese bus.
A further complication, however, is the Federal Transportation
Administration’s contention that BYD was not in compliance with federal
rules intended to aid minority- and woman-owned subcontracting firms
when the company won its $12.1 million contract last year. If that
contention is upheld, Long Beach Transit would not be able to spend
federal grant dollars on the bus contract, thus forcing the agency to
spend its own money or reopen the contract to new bidding.
Beach Transit spokesman Kevin Lee said in an email on Thursday that the
bus agency had no further comment on the federal government’s position.
Lee issued a statement late last month indicating that transit officials
were giving BYD time to settle its differences with the government.
BYD was in discussions with the FTA and Long Beach Transit about
its eligibility for the contract, said Brendan Riley, BYD’s vice
president of fleet sales, in an email Tuesday.