A few years ago, California was named the nation’s No.1 “judicial hellhole” by the American Tort Reform Foundation. The award was granted because of the state’s stupendous regulatory burden, high litigation rates, and unstable legal landscape. Nevertheless, California retains its appeal for businesses due to the size of its economy, which recently passed France and India.
The California state government keeps pushing its luck, however. Back in 2004 the legislature passed the Private Attorneys General Act (PAGA), which has turned out to be a thorn in the side of California employers ever since. The situation has been getting worse as a consequence of subsequent decisions by California courts that interpreted PAGA in a hghly questionable manner.
What PAGA Does
PAGA authorizes employees of California companies to sue their employer for damages on behalf of themselves, other employees, and even the state of California for violations of the California Labor Code. Essentially, any employee can file a class action lawsuit against a California employer by alleging widespread violations of the Labor Code.
California Courts Are Plaintiff-Friendly
When it comes to statutory law, there is text and there is interpretation. An already unfair law can be re-interpreted by the judiciary to make it even worse. Some would argue that the California judiciary has accomplished exactly that over the past 15 years or so:
Within two years of PAGA’s passage, California Courts of Appeal had ruled on two separate occasions that an employee suing under PAGA may seek two sets of penalties for the same employer infraction – one under the Labor Code and one under PAGA.
In 2014, the California Supreme Court struck down an arbitration agreement that prevented the employee for suing under PAGA, even though the employee signed the agreement. The reasoning given by the court was that such a clause violated public policy because the state of California has an interest in ensuring that employees can freely file PAGA lawsuits.
Recent court decisions have even begun to erode the principle that an employer must “knowingly and intentionally” violate California labor law to be the subject of a PAGA claim.
No one knows what difficulties future court decisions might bring. What is certain, however, is that the hostile interpretations already published combine with the notoriously plaintiff-friendly reputation of the California judiciary to put California employers in a weak bargaining position versus an employee who threatens to sue under PAGA.
The Sooner You Act Decisively, the Stronger Your Position Will Become
At CKB Vienna LLP, our California labor lawyers enjoy decades of combined experience helping our clients fight back against a civil compensation system that sometimes seems stacked against them. We know California labor law like we know the insides of our offices, and we win labor disputes – both in court and at the negotiating table – when push comes to shove.
We serve clients from all over Rancho Cucamonga, including Alta Loma and Etiwanda, as well as Upland, Fontana, Ontario, Chino Hills, and Claremont. Telephone us today at 909-980-1040, or fill out our online contact form so that we can schedule an appointment to discuss your case and explore your options.