In 2004, the Democrats passed legislation that allowed private people to sue companies, even if no harm has been done.
| “These reforms will essentially offer many of the “fixes” CA CALA has been advocating for since PAGA was signed into law by then Governor Gray Davis in 2004. The misuse and exploitation of PAGA took away the certainty that business owners needed. In one egregious example: some employers faced devastating PAGA lawsuits for failing to place the beginning date and ending date on a check stub even when the employee received his check on time and the check cleared the bank. There was no actual harm done. Yet, PAGA lawsuits like this did wipe out businesses across our state due to frivolous lawsuits filed.” Every once in a while we get a victory for common sense. But it takes a lot of effort to make this happen. Now is the time to go after the next corrupt policy of government. |
| CA CALA Applauds Significant PAGA Reform Legislation Thanks Its Supporters, Legislators, and Governor |
Citizens Against Lawsuit Abuse , 7/2/24 https://cala.com/
| California Citizens Against Lawsuit Abuse (CA CALA) and its supporters have long advocated to reform the one-sided Private Attorney General Act (PAGA). PAGA was intended to give an aggrieved employee, one who believed they were not paid their full wages, a vehicle to receive their fair compensation. Instead, it became a vehicle for trial attorneys to file shakedown lawsuits against employers for tens of thousands or millions of dollars for technical violations that ended up hurting both employers and employees. CA CALA applauds legislative leaders and the Governor for reaching an agreement that will significantly reform PAGA. The legislation, AB 2288 (Kalra-D San Jose) and SB 92 (Umberg-D Santa Ana) passed the legislature and was signed into law by Governor Newsom on July 1st. The legislation will specifically apply to PAGA actions filed after June 19, 2024. These reforms will essentially offer many of the “fixes” CA CALA has been advocating for since PAGA was signed into law by then Governor Gray Davis in 2004. The misuse and exploitation of PAGA took away the certainty that business owners needed. In one egregious example: some employers faced devastating PAGA lawsuits for failing to place the beginning date and ending date on a check stub even when the employee received his check on time and the check cleared the bank. There was no actual harm done. Yet, PAGA lawsuits like this did wipe out businesses across our state due to frivolous lawsuits filed. These owners need to know that they can operate in a fair and competitive business environment and not one that is legally stacked against them. Because of PAGA lawsuits many businesses were forced to close. Others left the state taking good paying jobs with them. Now, businesses will have more certainty. The changes in the agreed upon reform package look to be much better for both the employer and employee. The reform offers greater penalty payments to the aggrieved employees, lessens the opportunity for litigation by reducing the statute of limitations on when a claim can be filed, and gives employers an incentive to come into compliance with PAGA policies. Some of the reforms include: · Aggrieved employees will receive more, 35% instead of 25%, of the penalty payments. The employee will furthermore, actually have had to experience the alleged violation and experience it within the last year. Currently, there is no time limitation. · Penalties for employers will be capped and far less for employers than before. For employers who quickly took action before receiving a PAGA notice, the maximum penalty that can be awarded is 15%. For employers who took action after receiving a PAGA notice, the maximum penalty that can be awarded is 30%. It also reduces the maximum penalty substantially for minor violations such as typos on the wage statement. It addresses a flaw under PAGA that penalizes an employer, who pays employees on a weekly basis, being subject to paying twice the penalties compared to an employer who pays employees every other week. CA CALA supporters took precious time away from their businesses over the last 20 years to travel to Sacramento, meet with legislators in their district offices or via Zoom meetings, participate in press conferences and media interviews to share their stories of abusive PAGA lawsuits and why it needed to be reformed. We thank you. Your voice was heard. CA CALA also thanks California legislators over the years for their strong hearted efforts to reform PAGA. We thank former Assemblyman Don Wagner, then Assemblywoman Shannon Grove, then Assemblymember Rudy Salas, and others for their previous committed efforts. We thank the bill sponsors, Senate Judiciary Chair Tom Umberg, Assembly Leader Robert Rivas, and Assemblyman Ash Kalra, for their ability to bring both sides of the legislative aisle together to pass these needed reforms. We thank Governor Newsom for bringing all the parties involved in PAGA reform together to negotiate this much needed reform package. We thank all involved. |
Most employers did not lose any lawsuits because of PAGA. They settled with the claimant’s attorneys because it was cheaper that going to court. These suits will not go away. Business will still settle because their attorneys will tell them to do so. Look at worker’s comp claims and injury claims from fender benders.