California’s Private Attorneys General Act (PAGA) — Litigation And Compliance Manual

California’s Private Attorneys General Act (PAGA) — Litigation And Compliance Manual

California’s Private Attorneys General Act (PAGA) — Litigation And Compliance Manual

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Electronic $239.00
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Authors: Richard J. Simmons, Ryan J. Krueger, and Tyler J. Johnson
Publisher: Castle Publications
Edition: Third
ISBN: 9781940747842
Pages: Over 600

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CITED BY THE CALIFORNIA SUPREME COURT ON 1/18/24 IN ESTRADA v. ROYALTY CARPET MILLS OPINION

Description

The Private Attorneys General Act (called “PAGA”) has been nicknamed the “Sue Your Boss Law” because it motivates employees to sue employers instead of bringing internal complaints and grievances. Thousands of employers who have faced PAGA claims agree the law has become their worst enemy – a blatant anti-business law constructed by plaintiffs’ attorneys to increase the number of cases against employers. California employers are now hit with dozens of new PAGA actions every day. Worse yet, the legislature has shown no concern for the plight of small and large businesses that are still reeling from the economy while being targeted with costly litigation.

PAGA penalties for a single Labor Code violation can equal $100 for each employee times the number of pay periods for which the violation lasts. As an example, an employer with 100 employees could face penalties of $10,000 per pay period for just one violation. If the employer uses a weekly pay period, the penalties for one violation for just one year could be $520,000. Strikingly, the penalties can double for subsequent violations.

In this publication, Attorneys Richard J. Simmons, Ryan J. Krueger, and Tyler J. Johnson from the law firm of Sheppard, Mullin, Richter & Hampton LLP examine PAGA from top to bottom. The Manual provides HR officials, attorneys, practitioners and consultants a valuable, one-stop desk reference. Readers can learn to identify high risk areas, audit their policies and practices, understand litigation, and implement proactive measures to reduce exposure to liability.

Among the subjects covered in this publication are:

  • The Most Common PAGA Claims
  • The Supreme Court’s View Of PAGA
  • Exhaustion Of Administrative Remedies Before Filing Lawsuits
  • Civil Penalties & Remedies
  • The Effect Of Arbitration Agreements And Class Action Waivers
  • The Authority Of Courts To Lower Penalties
  • Factors Considered When Awarding Penalties
  • Meal And Rest Period, Overtime, Bonus, And Other Common Claims
  • Suitable Seating Cases
  • Court Approval Of Settlements
  • Pay Stub Claims
  • Opportunity To Cure Violations
  • Checklists & High Risk Areas
  • Defending Multiple PAGA Cases
  • Liabilities
  • Defense Strategies
  • The Effect Of PAGA Actions On Appeals Based On The Death Knell Doctrine
  • The Distinctions In PAGA-Only Actions
  • One-Sided Attorney’s Fee Provision
  • Statutes Of Limitations In PAGA Cases
  • Avoiding Litigation And Conducting Self-Audits
  • The Effect Of Individual Settlements On PAGA Standing
  • The Role Of The State And Courts In PAGA Settlements
  • Notification Rules
  • Labor Code Checklist
  • Role Of Legal Counsel
  • Contesting Settlements
  • Role Of LWDA
  • The Issues Associated With Chindarah v. Pick Up Stix Settlements

Additional information

Format

Both, Electronic, Print

Table Of Contents

PREFACE

CHAPTER 1          THE PRIVATE ATTORNEYS GENERAL ACT OF 2004

1.1                The Context In Which PAGA Was Enacted And Its Impact

1.2                PAGA’s Focus On Enforcement

1.3                PAGA Creates New Remedies Without Creating New Substantive Rules

1.4                The Reduced Role Of State Enforcement Agencies

1.5                PAGA’s Enforcement System

1.6                The Relevance Of California’s Class Action Requirements

1.7                Abbreviations Used In The Manual

1.8                Other Important Resources

CHAPTER 2          OVERVIEW OF PAGA

2.1                The Use Of Civil Actions To Enforce California’s Wage And Hour Laws

2.2                Law Enforcement Actions Under PAGA

2.3                Section 558 Claims Against Employers And Individuals

2.4                Minimum Wage Claims Against Employers And Individuals Under Section 1197.1

2.5                Labor Code Section 1198’s Pathway To Wage Order Enforcement

2.6                Varied Motivations For PAGA Actions

2.7                PAGA Establishes A Punishment System While Trivializing The Critical Need For Education And Information

2.8                The Statutory Structure Of PAGA

2.9                The Enactment Of PAGA And Its Amendments

2.10              Key Definitions And Rules In PAGA

2.11              Construction And Janitorial Employees Covered By CBAs Are Excluded From PAGA

2.12              Posting, Notice, Reporting And Filing Violations

2.13              PAGA’s Cure Provisions

2.14              PAGA Statistics

CHAPTER 3          PAGA’S EXHAUSTION, ADMINISTRATIVE AND PROCEDURAL STANDARDS

3.1                Obligations To Provide Proper Notice And Exhaust Administrative Remedies

3.2                The Categories Of Violations Identified In PAGA

3.3                Claims Based On Specified Statutes – Category 1 Statutes

3.4                Claims Based On Other Labor Code Provisions – Category 2 Statutes

3.5                Claims Based On Occupational Safety Violations

3.6                Scope Of Claims That An Aggrieved Employee Can Pursue

CHAPTER 4           REPRESENTATIVE ENFORCEMENT ACTIONS AND CLASS ACTIONS

4.1                Class Action Requirements

4.2                Distinctions Between Class Actions And PAGA Actions

4.3                The Basic Class Action Standards Under California Law In The CCP

CHAPTER 5          THE CALIFORNIA SUPREME COURT’S VIEW OF PAGA

5.1                The California Supreme Court’s Perspective On PAGA

5.2                Arias v. Superior Court:  The Inapplicability Of Class Action Standards To PAGA Actions And The Effect Of PAGA Judgments

5.3                Amalgamated Transit Union, Local 1756, AFL-CIO v. Superior Court: A Labor Union Cannot Bring A PAGA Action

5.4                Iskanian v. CLS Transportation Los Angeles, LLC:  The Effect Of The FAA And Class Action Waivers

5.5                Williams v. Superior Court:  Discovery Rights In PAGA Actions

5.6                Mendoza v. Nordstrom, Inc.:  PAGA Authorizes A Representative Action Without The Need For Class Certification

5.7                ZB, N.A. v. Superior Court:  Employees Can Pursue Civil Penalties Through PAGA, But Not Claims For Unpaid Wages Or Compensatory Relief

5.8                Kim v. Reins Int’l California, Inc.:  Employees Do Not Lose Standing To Pursue PAGA Claims By Settling And Dismissing Their Individual Claims

5.9                Viking River Cruises, Inc. v. Moriana:  FAA Preempts California Laws That Preclude Division Of Individual PAGA Claims

CHAPTER 6          ITEMIZED WAGE STATEMENT AND PAGA CLAIMS

6.1                California’s Overlapping Wage Statement And PAGA Rules

6.2                Injunctive Relief

6.3                Payroll Companies

6.4                Government Employer Exemption

6.5                Residential Worker Exemption

6.6                Right to Inspect Or Receive A Copy Of Pay Records

6.7                Relationship With Unfair Competition Claims

6.8                PAGA’s Applicability To Pay Stub Violations

6.9                The Overlapping Regulation Of Wage Statements Under PAGA And Labor Code Section 226

6.10               PAGA And Labor Code Section 226 Issues Involving Notice Of Paid Sick Leave

CHAPTER 7          ARBITRATION OF PAGA CLAIMS

7.1                A Waiver Of The Right To Bring A PAGA Claim In Court Cannot Be Enforced

7.2                Under Ninth Circuit Authority, Predispute Arbitration Agreements Can Be Enforced To Compel The Arbitration Of PAGA Claims

7.3                The U.S. Supreme Court Affirmed The Ability To Compel PAGA Claims To Arbitration

7.4                The California Supreme Court Will Weigh In On The Fate Of Representative PAGA Claims

7.5                Post-Dispute Arbitration Agreements Are Enforceable

7.6                Agreements To Arbitrate Non-PAGA Claims

CHAPTER 8          LITIGATION CONSIDERATIONS

8.1                Removal And The Class Action Fairness Act

8.2                PAGA And Venue

8.3                The Complexity Of PAGA Actions

8.4                PAGA Discovery – Obtaining Aggrieved Employee Contact Information

8.5                The Need For An Adequate Trial Plan

8.6                PAGA Actions And Manageability

8.7                There Is No Jury Trial Right In PAGA Actions

8.8                Staying PAGA Actions Based Upon The Exclusive Concurrent Jurisdiction Rule

8.9                Bifurcation Of Trials

8.10               Courts Can Lower Penalty Awards Under PAGA

8.11               Establishing A Right To PAGA Penalty Recoveries

8.12              Burden of Proof

8.13              Claims That May Be Brought Under PAGA

CHAPTER 9          REMEDIES

9.1                Penalties Recoverable Under PAGA

9.2                Recovery Of Penalties vs. Victim-Specific Relief

9.3                Courts Have Discretion To Award Lesser Penalties

9.4                Injunctive Relief

9.5                The Effect Of A PAGA Judgment

9.6                The Scope Of PAGA Judgments

CHAPTER 10        DEFENSES IN PAGA LITIGATION

10.1              Introduction

10.2              Failure To Exhaust

10.3              Statute Of Limitations

10.4              Lack Of Standing And Lack Of Violation

10.5              Affirmative Defenses

10.6              Motions To Strike

10.7              Construction And Janitorial Employees Covered By Collective Bargaining Agreements

10.8              Other Defenses

CHAPTER 11        SETTLEMENT OF LABOR CODE AND PAGA CLAIMS

11.1              PAGA’s Statutory Framework On Settlement

11.2              Factors Courts Consider When Reviewing PAGA Settlements

11.3              The Res Judicata Impact Of A PAGA Settlement

11.4              Where The Named Plaintiff Has Settled On An Individual Basis

11.5              Using Individual Settlements With Employees To Resolve Claims

CHAPTER 12        APPEALS

12.1              Appeals In PAGA Actions

12.2              The Death Knell Doctrine Does Not Apply Where A Pending PAGA Claim Must Be Adjudicated After Class Certification Is Denied

12.3              Even If The Death Knell Doctrine Does Not Apply, A Reviewing Court Has Discretion To Consider The Merits Of A Premature Appeal By Treating It As A Writ

12.4              A Defendant May Not Appeal An Adverse PAGA Ruling Until A Final Judgment In The Case Is Issued

12.5              Standing To Appeal PAGA Settlements

12.6              PAGA Claims Are Subject To An Automatic Bankruptcy Stay

12.7              The LWDA’s Decision On A Cure Dispute May Be Appealed To The Appellate Division Of The Superior Court

CHAPTER 13        COMPLIANCE AUDITS

13.1              The Legislature’s Emphasis On Compliance

13.2              The Importance Of Self Audits

13.3              Audit Process And Subjects

13.4              Need For Legal Counsel

CHAPTER 14        LABOR CODE CHECKLISTS AND SUMMARIES

14.1              The Pursuit Of Penalties Under The PAGA

14.2              Labor Code Checklist

14.3              High Risk Areas

CHAPTER 15        ADDITIONAL TARGET AREAS FOR AUDITS

CHAPTER 16        LEAVES OF ABSENCE AND TIME OFF RIGHTS

16.1              Overview

16.2              Audit Issues

16.3              Additional Resources

CHAPTER 17        POSTING AND NOTIFICATION OBLIGATIONS

APPENDIX A        THE LABOR CODE PRIVATE ATTORNEYS GENERAL ACT OF 2004 Labor Code §§ 2698 – 2699.6

APPENDIX B        SB 796 — THE PRIVATE ATTORNEYS GENERAL ACT OF 2004 (Signed October 12, 2003)

APPENDIX C        SENATE RULES COMMITTEE REPORT ON SB 796 (September 11, 2003)

APPENDIX D        ASSEMBLY FLOOR ANALYSIS OF SB 796 (September 2, 2003)

APPENDIX E        SB 899 (Signed April 19, 2004)

APPENDIX F        SB 1809 (Signed August 11, 2004, As An Urgency Statute)

APPENDIX G        ASSEMBLY FLOOR ANALYSIS OF SB 1809 (July 29, 2004)

APPENDIX H        SENATE RULES COMMITTEE REPORT ON SB 1809 (July 29, 2004)

APPENDIX I         SB 940 (Effective January 1, 2009)

APPENDIX J         AB 1506 (Effective October 2, 2015)

APPENDIX K        SB 836 (Effective January 1, 2016)

APPENDIX L        AB 235 (Stats. 2018, Ch. 704518) (Effective September 22, 2018)

APPENDIX M       AB 1654 (Effective January 1, 2019)

APPENDIX N        FORMS OF LABOR & WORKFORCE DEVELOPMENT AGENCY

APPENDIX O        LOS ANGELES COUNTY SUPERIOR COURT FORM CREATED TO EVALUATE CLASS ACTION SETTLEMENTS

APPENDIX P        LOS ANGELES COUNTY SUPERIOR COURT CLASS ACTION CASE MANAGEMENT ORDER

APPENDIX Q        LOS ANGELES SUPERIOR COURT WAGE AND HOUR SETTLEMENT AGREEMENTS (LACIV296, LACIV297, LACIV298)

APPENDIX R        LABOR CODE INDEX

APPENDIX S        CASE TABLE

SUBJECT INDEX

About The Authors

Richard J. Simmons is a Partner in the law firm of Sheppard, Mullin, Richter & Hampton LLP in Los Angeles. He represents employers in various employment law matters involving litigation throughout the country and general advice regarding state and federal wage and hour laws, employment discrimination, wrongful discharge, employee discipline and termination, employee benefits, affirmative action, union representation proceedings, and arbitrations. Mr. Simmons received his B.A., summa cum laude, from the University of Massachusetts, where he was a Commonwealth Scholar and graduated in the Phi Kappa Phi Honor Society. He received his J.D. from Berkeley Law at the University of California at Berkeley where he was the Editor-in-Chief of the Industrial Relations Law Journal, now the Berkeley Journal of Employment and Labor Law.

Mr. Simmons argued the only case before the California Supreme Court that produced a victory for employers and business in 2018. He was recently recognized as the Labor and Employment Attorney of the Year by the Los Angeles Business Journal and was inducted into the Employment Lawyers Hall of Fame. He has lectured nationally on wage and hour, employment discrimination, wrongful termination, and other employment and labor relations matters. He is a member of the National Advisory Board to the Berkeley Journal of Employment and Labor Law, published by Berkeley Law at the University of California at Berkeley. He was also appointed by the California Industrial Welfare Commission as a member of three Minimum Wage Boards for the State of California.

Ryan J. Krueger is a Partner with Sheppard, Mullin, Richter & Hampton LLP in the firm’s Los Angeles office. He specializes in labor and employment matters on behalf of employers, including wage and hour violations, employment discrimination, wrongful termination and sexual harassment. Mr. Krueger has experience in all aspects of employment litigation, including brief writing and oral argument, taking and defending depositions, and negotiating settlements. He has also second chaired multiple trials and arbitrations, and argued before the California Court of Appeal. Mr. Krueger also regularly counsels employers regarding California and federal employment law issues.

Ryan is a co-author of the California’s Private Attorneys General Act (PAGA) Litigation and Compliance Manual, a contributing author to the Employer’s Guide to COVID-19 and Emerging Workplace Issues and the ALERT Newsletter. He is a co-speaker at the Castle Publications’ Seminars as well as the Labor Law Update for Sheppard Mullin.

He received his J.D. from the University of California, Los Angeles and his B.A. from the University of Wisconsin, with distinction. During law school, Mr. Krueger served as extern to the Honorable Morton Denlow, U.S. District Court for the Northern District of Illinois. He is admitted to practice in all California state courts, along with the United States District Court for the Central District of California and the Ninth Circuit Court of Appeals.

Tyler J. Johnson is an associate with Sheppard, Mullin, Richter & Hampton LLP in the firm’s Los Angeles Office. Mr. Johnson represents employers in every stage of the litigation process, from prelitigation disputes to class certification hearings and trials. He represents businesses of every size, and has extensive experience in the healthcare, agricultural, fashion, and temporary staffing industries. Mr. Johnson defends employers against claims of discrimination, harassment, and retaliation, and has prevailed at trial in a pregnancy discrimination case. Tyler also routinely represents businesses in complex litigation, including proposed class actions and representative actions under the Private Attorneys General Act.

Mr. Johnson has defeated class certification in a number of cases and frequently obtains summary judgment for employers.

Tyler received his J.D. degree from the Pepperdine Caruso School of Law and his B.A. from the University of Maryland. Mr. Johnson served as a Law Clerk to the Honorable Ronald S.W. Lew of the U.S. District Court for the Central District of California.

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