Gov. Gavin Newsom signed a bill to reform Private Attorney General Actions—a type of labor suit—on July 1.
PAGA cases allow individual workers to bring cases for violations of labor law—effectively giving them the power of the attorney general. Under the law, workers can sue for pay issues such as unpaid overtime wages or missed meal breaks. Californians were granted the power to bring PAGA suits in 2008. Prior to 2008, a state office brought labor violation cases.
Assembly Bill 2288 will cut civil penalties for employers to 30% if the employer takes steps to correct their alleged violation within two months of the complaint being filed. Those steps can include an audit, the publication of new policies or supervisory training on the Labor Code.
The bill will also increase penalties for employers who are frequently found to break labor law.
The bill sets civil penalties at $50 per aggrieved employee per period, if the alleged violation was from an isolated event. If the violation is recurring, the bill sets penalties at $100 per aggrieved employee per pay period. If a court had found the employer had broken labor law within the last five years, or if they were malicious, fraudulent or oppressive in their conduct, penalties are $200 per aggrieved employee per pay period.
It also allows PAGA cases to have injunctive relief.
The reform will allocate 35% of penalty money to employees—a change from the 25% employees previously received. The remaining percentage goes to the Labor and Workforce Development Agency.
“This will ensure there is meaningful change in the workplace by allowing the courts to order employers to remedy when they break the law, whether they’re committing wage theft, misclassifying employees, or putting workers’ health and safety at risk,” said bill author Assemblymember Ash Kalra (D-San José) in a press release.
In a June 24 Senate Judiciary Committee hearing, Kalra said that current labor law does not cause labor law enforcement because there was little incentive for employers to come into compliance.
“This reform is decades in the making — and it’s a big win for both workers and businesses. It streamlines the current system, improves worker protections, and makes it easier for businesses to operate,” Newsom said in a press release.
The law will apply to any PAGA cases filed after July 19.
Read the law here.
