Deterring, Defeating and Resolving PAGA Claims
Claims under the Private Attorneys General Act of 2004 (“PAGA”) have become pervasive for California employers. Representative PAGA actions can put businesses in jeopardy, as they present significant financial exposure.
Positioning clients in front of PAGA claims is a hallmark of CDF’s approach to managing PAGA litigation. Our dedicated team of attorneys focuses on identifying weaknesses and areas of potential liability in clients’ policies, practices and procedures, and developing novel and creative strategies for defeating and minimizing liability stemming from PAGA claims.
The Representative Nature of PAGA Claims and Resulting Civil Penalty Liability
The PAGA allows current and former workers to “step into the shoes” of the state in an action to enforce California’s Labor Code and recover substantial civil penalties. On the surface, PAGA actions appear like wage and hour class actions, but significant differences lie beneath. California courts have found that class action procedures do not apply to PAGA claims, that workers cannot waive representative PAGA claims through a pre-dispute arbitration agreement, and that some PAGA plaintiffs can bring claims based on alleged violations they never experienced.
Also, even where a Labor Code violation causes no harm or underpayment, the PAGA provides for civil penalties ranging from $50-$200 for each employee times the number of pay periods in which the employee experienced the violations. Moreover, the PAGA allows prevailing plaintiffs (but not employers) to recover their attorney fees and costs. These developments led to a rapid increase in California PAGA actions. California employers are now hit with hundreds of PAGA claims each month.
CDF’s Approach for Preventing and Mitigating PAGA Claims
PAGA claims often arise from highly technical issues related to payroll, timekeeping, and standard operations. CDF attorneys regularly evaluate and revise clients’ payroll, timekeeping, and operational policies to increase compliance and minimize potential civil penalty liability. Our attorneys also assist in implementing related procedures aimed toward avoiding claims and liability in the first place. Our vast experience litigating PAGA claims allows us to conduct these evaluations and consultation with an eye toward both traditional and emerging theories of liability.
However, PAGA litigation is not always preventable. When clients are faced with a PAGA lawsuit, CDF promptly conducts an analysis and investigation of the claims, charting a strategic course toward the most effective and efficient resolution available. This allows our team to take assertive action in alignment with our client’s goal; whether that is a prompt and fair settlement, efficient summary judgment dismissal, or, when necessary, an aggressive trial-track strategy backed by experienced trial attorneys who can try a case through to verdict to send a powerful message and prevents future risks.