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PAGA Reform Coming Soon…

Governor Gavin Newsom, in partnership with legislative leadership and business and labor groups, announced an agreement on reforms to the Private Attorney General Act (PAGA). The Governor described the new package as reforming PAGA’s penalty structure, reducing and streamlining litigation and improving measures for injunctive relief and standing, and strengthening state enforcement.

Here are some key points of what the PAGA reform proposal would do:

Reform Penalty Structure

  • Encourages compliance with labor laws by capping penalties on employers who promptly act to resolve policy lapses after receiving PAGA notice, as well as on employers who proactively adhere to Labor Code standards before receiving a PAGA notice.
  • Creates new, higher penalties on employers who act maliciously, fraudulently or oppressively in violating labor laws.
  • Shifts penalty allocation on employees, increasing penalties from 25% to 35%

Reducing and Streamlining Litigation

  • Increases the number of Labor Code sections that can be cured, reducing the need for litigation and making employees whole quickly.
  • Enhances a more robust right to cure process through the Labor and Workforce Development Agency (LWDA) to reduce litigation and costs.
  • Codifies the limitation on the scope of claims presented at trial to ensure cases are both manageable and adjudicated properly.

Improving Measures for Injunctive Relief and Standing

  • Allows courts to compel businesses to implement changes in the workplace to remedy labor law violations.
  • Requires employees to personally experience the alleged violations to bring in a claim.

Strengthening State Enforcement

  • Empower the Department of Industrial Relations (DIR) to expedite hiring and fill vacancies, with the aim of ensuring effective and timely enforcement of employee labor claims.

It is anticipated that the California legislature will pass the proposed bill, and be signed by the Governor before June 27. Once the PAGA proposed reform is passed, employers will have a better understanding how this reform will significantly change the landscape of PAGA litigation. To stay up to date on PAGA reform or to undergo a compliance audit to ensure that you are running your business California labor complaint to minimize your PAGA risk contact the Employer Lawyers at Chauvel & Glatt.

This material in this article, provided by Chauvel & Glatt, is designed to provide informative and current information as of the date of the post. It should not be considered, nor is it intended to constitute legal advice.  For information on your particular circumstances, please contact  Chauvel & Glatt at 650-573-9500 for legal assistance near you.

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