The CalChamber Board of Directors has voted to support the California Fair Pay and Employer Accountability Act, a reform initiative that would repeal the Private Attorneys General Act (PAGA) and replace it with enhanced enforcement mechanisms by the Labor Commissioner.
“This initiative eliminates an abusive process for trial attorneys to file frivolous lawsuits, and provides a pathway for employees to pursue claims for wages and penalties, where the employee keeps 100% of the recovery” said CalChamber President and CEO Jennifer Barrera.
Lawsuits filed under PAGA have increased more than 1,000% from the law’s first year in effect with the Labor and Workforce Development Agency (LWDA) receiving approximately 4,000 PAGA notices each year since 2014. The profusion of PAGA lawsuits has been driven by significant monetary awards that can be leveraged against an employer for minor violations.
These lawsuits, however, have not necessarily increased the recovery amount employees receive or protected their interest. After reviewing more than 1,500 PAGA settlements, the LWDA gave plaintiff’s attorneys “a fail or marginal pass,” at adequately protecting the interests of aggrieved employees.
“Voters should approve this important reform measure for the benefit of workers and employers. This initiative will ensure legitimate claims are resolved in a timely fashion without the need of an attorney, with workers receiving double penalties for willful violations. In addition, the measure will allow employers to invest more revenue in their employees and operations rather than defending themselves against frivolous lawsuits,” said Barrera.
The California Chamber of Commerce (CalChamber) is the largest broad-based business advocate to government in California. Membership represents one-quarter of the private sector jobs in California and includes firms of all sizes and companies from every industry within the state. Leveraging our front-line knowledge of laws and regulations, we provide products and services to help businesses comply with both federal and state law. CalChamber, a not-for-profit organization with roots dating to 1890, promotes international trade and investment in order to stimulate California’s economy and create jobs. Please visit our website at www.calchamber.com.