California has some of the strictest labor laws in the country. That’s excellent news for workers, but it also means there are more ways employers may violate their employees’ rights. If every employee struggling with a labor violation had to go through the state Labor Commissioner to have their complaint resolved, most workers would never see a resolution.
That’s why the Private Attorneys General Act (PAGA) was first enacted in California 20 years ago. It grants employees the right to sue on their own behalf instead of going through the Labor Commissioner’s Office for labor violations. However, the law has recently undergone substantial review and revisions that may alter your ability to file a claim. Here’s an in-depth look at what PAGA is, the recent reforms, and how you can use it to protect your rights.
Understanding the Private Attorneys General Act (PAGA)
The Private Attorneys General Act was enacted in California in 2004 to enhance labor law enforcement. PAGA empowers employees to sue employers on behalf of themselves, other employees, and the state of California for labor code violations. Essentially, it deputizes employees as private attorneys general, enabling them to enforce labor laws that the state might otherwise struggle to oversee due to limited resources.
Under the original form of PAGA, employees could file lawsuits for various labor code infractions, such as unpaid wages, missed meal and rest breaks, and workplace safety violations. The penalties recovered through PAGA lawsuits were distributed, with 75% going to the state’s Labor and Workforce Development Agency (LWDA) and 25% to the affected employees.
Recent Reforms to PAGA
On June 18, 2024, Governor Gavin Newsom announced a comprehensive reform package for PAGA. These changes aim to address concerns about the increasing number of PAGA cases and the substantial penalties they impose on employers. Here are the key elements of the reform:
Stricter Standing Requirements
The reform introduces more stringent standing requirements for employees (plaintiffs) bringing claims. Now, an employee must have personally experienced the alleged violations to file a claim, and these violations must have occurred within the past year. This change prevents frivolous claims and ensures that only current and directly impacted employees can pursue legal action.
Adjustments to Penalties
The penalty structure under PAGA has been significantly revised:
- Caps on Penalties: Employers who proactively comply with the Labor Code before receiving a notice will face a maximum penalty of 15% of the full potential penalty amount. For those who take corrective steps after receiving a notice, the cap is set at 30%.
- Reduction for Minor Violations: The maximum penalty is reduced for minor infractions, such as brief violations or wage statement errors that did not cause confusion or economic harm.
- Equity for Weekly Pay: Adjusted penalties ensure fairness for employers who pay weekly, addressing previous disparities.
- New Penalty for Malicious Acts: Employers who act maliciously, fraudulently, or oppressively will face a new penalty of $200 per pay period.
- Addressing Stacking of Penalties: The reform limits a plaintiff’s ability to stack multiple penalties for labor code violations that stem from a single breach.
Employer Right to Cure
The reform expands the Labor Code sections that employers can cure to reduce or eliminate potential penalties altogether. This provision encourages employers to rectify violations promptly.
Strengthening Enforcement
To improve and expedite the enforcement process, the reform package includes measures to expedite hiring and filling vacancies within the California Department of Industrial Relations (DIR). A stronger enforcement agency ensures labor laws are upheld efficiently and effectively.
Increased Employee Share of Penalties
Previously, employees were entitled to 25% of any penalty awarded, with the state receiving the remaining 75%. The new reform increases the employees’ share to 35%, providing greater compensation for those affected by labor law violations.
Judicial Discretion
The reform grants courts the power to limit the scope of claims and the evidence presented at trial, giving judges more discretion to manage cases effectively and prevent the misuse of PAGA.
Injunctive Relief
Finally, the reform allows courts to issue orders preventing ongoing violations, providing an additional layer of protection for employees.
Using PAGA to Sue Employers
If you believe your employer has violated California labor laws, you can use PAGA to seek justice. Here’s a step-by-step guide on how to proceed:
- Documentation: Gather evidence of the alleged labor law violations, such as pay stubs, time records, and any relevant correspondence with your employer.
- Filing a PAGA Notice: Before filing a lawsuit, you must file a notice with the LWDA detailing the violations. The agency has 65 days to review the notice and decide whether to investigate the claim.
- Waiting Period: If the LWDA declines to investigate or does not respond within 65 days, you can proceed with filing a lawsuit. If the LWDA decides to investigate, you must wait for the outcome of their investigation.
- Legal Action: Once you receive authorization or after the waiting period, you can file a lawsuit in civil court on behalf of yourself, other affected employees, and the state.
- Settlement or Trial: Many PAGA cases settle out of court. If a settlement is not reached, the case proceeds to trial, where the court will determine whether the employer violated labor laws and the appropriate penalties.
Working with an experienced attorney is key to navigating this process, particularly with the recent updates to PAGA.
Fight Back Against Labor Code Violations With the Law Office of Todd M. Friedman, P.C.
The recent reforms to PAGA aim to balance the need for effective labor law enforcement with fairness for employers. These changes provide clearer guidelines and protections for both employees and employers. If you believe your labor rights have been violated, the Law Offices of Todd M. Friedman, P.C., is here to help you navigate the complexities of PAGA and seek the justice you deserve. Contact us today for a consultation and to learn more about your rights under California labor law.
