The California Labor Commissioner’s Office said in a press release Thursday that the Terranea Resort, in the Los Angeles suburb of Rancho Palos Verdes, was levied with the multimillion penalty following an investigation into the resort’s hiring practices.

The investigation into the 102-acre, 582-room resort began in July 2021 after 14 reports alleged that the luxury complex was in violation of the newly signed “Right to Recall” law. The legislation required hotels that were reopening after the COVID-19 shutdown to first offer jobs to former employees that had been laid off.

Each worker who is not offered a rehiring is entitled to $500 per day until their employer offers them their previous job, according to the law. An additional $100 penalty against the employer is also imposed each day.

The law was initially passed in an effort to stop hotels and other service industries from discriminating against laid-off employees.

Terranea Resort reopened in June 2020 after being closed the previous three months. The investigation report alleges that the resort’s management did not re-offer jobs to at least 53 employees who had formerly worked at the property.

These previous employees included housekeepers, servers, bartenders and other service industry workers, the labor commissioner’s office said. These workers would be among those who receive the $3.3 million, which the office said would be distributed mainly among those who were not offered their jobs back.

The 14 workers involved in the original complaint would receive $1.3 million, or about $95,750, according to the official citation obtained by the Los Angeles Times.

“These workers invested years of service at Terranea and through no fault of their own lost their jobs due to the pandemic,” Labor Commissioner Lilia García-Brower said in the press release. “The law makes it clear that workers in the hospitality and services industries must be prioritized to return to the same or similar positions when their former employer reopens for business.”

In a statement, though, Terranea Resort told the Times, “We strongly disagree with the Labor Commissioner’s citation, which is not a finding of fact. We are exploring all of our legal options.”

The resort also described the Right to Recall law as “ambiguous and poorly-defined language,” adding that 85 percent of the staff that worked at the hotel before the pandemic shutdown had returned.

“We demonstrate our care and concern for our associates through our deeds, not just words,” the resort said.

Terranea Resort is the first business to be accused of violating the Right to Recall legislation. The law runs through the end of 2024 and, beyond hotels, also applies to airports and event centers.

This is not the first legal battle that the resort has faced.

In 2019, the hotel paid a $2.1 million settlement from workers who claimed they were not paid for the time it took to be driven to and from the resort. That same year, a former cook was also paid $35,000 after he was fired following attempts to unionize.

Newsweek has reached out to the Terranea Resort for comment.