Ritz-Carlton Fined Over $2M for Misclassifying Janitors

The California Labor Commissioner’s Office (LCO) cited the Ritz-Carlton Hotel Co. LLC and three janitorial contractors more than US$2 million for misclassifying 155 janitors as independent contractors at its Half Moon Bay hotel. The citations include $1.9 million in wages and penalties payable to the affected workers.

An investigation by the LCO’s Bureau of Field Enforcement (BOFE) found that the out-of-state contractors misclassified the janitors as independent contractors and denied them basic legal protections, including minimum wage, overtime, paid sick leave, and workers’ compensation benefits.

A study from the UCLA Labor Center found that subcontracted janitors in California are more likely to earn lower wages and face labor violations than those directly employed. To address these systemic issues, California established the janitorial registration program and strengthened joint employer accountability laws to better protect vulnerable workers in the sector.

From July 2021 through January 2024, the Ritz-Carlton contracted with a Georgia-based company, Empire Unistar Management Inc., to handle janitorial services. Empire Unistar Management, in turn, subcontracted the work to two other out-of-state companies—TK Service of Virginia and later JM Spa Group of Florida. None of these janitorial contractors were registered with the state’s mandated janitorial registration program.

California law makes clear that companies cannot outsource responsibility for worker protections. If TK Service and JM Spa fail to pay the wage assessments and penalties, both the Ritz-Carlton Hotel and Empire Unistar Management will be jointly liable for a total of $746,001.