Proposed Changes To PAGA May Limit Lawsuits Filed By “Aggrieved” Employees

The Private Attorneys General Act of 2004 (“PAGA”), Labor Code sections 2699 et seq., permits aggrieved employees to file lawsuits to recover civil penalties on behalf of themselves, other employees, and the State of California for Labor Code violations.

Currently, the only burden on an employee filing a PAGA claim is to simply set forth “the facts and theories to support the alleged violation.” Relying on this language, employees have been able to make accusations against their employer without any real substance to back it up. Further, there is no requirement that the employee actually be “aggrieved.” Consequently, civil penalties are being awarded to employees without regard to whether the employee actually suffered an injury. However, a bill pending before the California Legislature may raise the bar for making allegations and offer some rationality to the PAGA process.

AB-2016 alters the language of PAGA to require that allegations be made with particularity, rather than simply stating an amorphous theory of labor code violations. Specifically, the amendment requires an employee submit notice of alleged violations to the employer that contains, “a statement setting forth the relevant facts, legal contentions, and authorities supporting each alleged violation. The notice shall also include an estimate of the number of current and former employees against whom the alleged violation or violations were committed and on whose behalf relief is sought.”

AB-2016 will also limit awards of civil penalties to employees “based only upon violations by the employer actually suffered by that employee.” The bill also increases the amount of time given to employers to cure any alleged violations from 33 days to 65 days. If such violations are cured within the given time frame, employers may avoid a civil action and resulting penalties.

While these amendments are an exciting prospect for employers, it is important to keep in mind that AB-2016 is still in its early changes. AB-2016 is scheduled for a Hearing with the Committee on Labor and Employment on April 4, 2016 at 1:30pm. To encourage passage of this bill, you may contact the Committee on Labor and Employment by calling (916) 319-2091.