By Trevor White
A recent case might introduce key changes to how California courts handle representative claims brought by Plaintiffs under the Private Attorneys General Act (PAGA). PAGA allows a Plaintiff to stand in the shoes of the Labor Commissioner’s Office to pursue civil penalties on behalf of the state of California for Labor Code violations. PAGA is often used as an alternative to class actions because there are fewer requirements to certifying a representative action under PAGA. Furthermore, employers are often on the hook for numerous civil penalties in addition to damages if they are found liable under PAGA.
Historically, PAGA plaintiffs did not have to show the court that their cases were “manageable,” or that it was reasonably possible to get through the claims in court in a timely manner. A recent California appellate case, Wesson v. Staples The Office Superstore, LLC (“Wesson”), potentially changes this.
Wesson imposes the requirement that PAGA claims be manageable, which could greatly cut back on the size and scope of PAGA claims by removing the claims and plaintiffs that would take too long to fight over at trial. By removing some claims and plaintiffs in these PAGA actions, employer liability has the potential to be greatly reduced. Therefore, under Wesson, employers may be able to get PAGA complaints struck for being unmanageable, greatly limiting their exposure.
The Wesson case has been appealed and is currently waiting on whether the California Supreme Court will hear this case. If the Supreme Court decides not to hear Wesson, its ruling will stand and employers can use unmanageability as a defense to PAGA claims.
COUNSEL TO MANAGEMENT
Even if the manageability requirement stands, PAGA claims will still be a major challenge for employers, especially those who directly employ many workers. If you have any questions about how this development may affect your business, contact the experts at The Saqui Law Group.