AB 281: Labor Code Private Attorneys General Act of 2004: right to cure.
- Session Year: 2017-2018
- House: Assembly
- Latest Version Date: 2017-04-26
The Labor Code Private Attorneys General Act of 2004 authorizes an aggrieved employee who complies with specified notice and filing requirements to bring a civil action to recover specified civil penalties that would otherwise be assessed and collected by the Labor and Workforce Development Agency (agency). Existing law provides that an employee who prevails in an action under these provisions is entitled to recover his or her filing fees and reasonable attorneys fees and costs. Existing law provides that civil penalties may be assessed against the employer, as provided. Agency. The act provides an employer a right to cure violations under the act, except for certain specified violations, including health and safety violations, before the aggrieved employee may bring a civil action. The act requires that the employer cure a violation within 33 calendar days of the postmark date of the notice sent by the aggrieved employee or representative.
The bill would provide that an aggrieved employee may be awarded civil penalties based only upon a violation by the employer actually suffered by that employee.The Labor Code Private Attorneys General Act of 2004 provides an employer a right to cure violations under the act before the aggrieved employee may bring a civil action. The act excludes from the right to cure provisions, various specified violations and other specified health and safety violations. The act requires the employer to cure a violation within 33 calendar days of the postmark date of the notice sent by the aggrieved employee or representative.This bill would instead exclude only the health and safety violations from the right to cure provisions. The bill would also extend the period of time in which the employer may cure the violation from 33 to 65 calendar days.
The Labor Code Private Attorneys General Act of 2004 authorizes an aggrieved employee who complies with specified notice and filing requirements to bring a civil action to recover specified civil penalties that would otherwise be assessed and collected by the Labor and Workforce Development Agency (agency). Existing law provides that an employee who prevails in an action under these provisions is entitled to recover his or her filing fees and reasonable attorneys fees and costs. Existing law provides that civil penalties may be assessed against the employer, as provided.
The bill would provide that an aggrieved employee may be awarded civil penalties based only upon a violation by the employer actually suffered by that employee.
The Labor Code Private Attorneys General Act of 2004 provides an employer a right to cure violations under the act before the aggrieved employee may bring a civil action. The act excludes from the right to cure provisions, various specified violations and other specified health and safety violations. The act requires the employer to cure a violation within 33 calendar days of the postmark date of the notice sent by the aggrieved employee or representative.
This bill would instead exclude only the health and safety violations from the right to cure provisions. The bill would also extend the period of time in which the employer may cure the violation from 33 to 65 calendar days.
(a)A civil action by an aggrieved employee pursuant to subdivision (a) or (f) of Section 2699 alleging a violation of any provision listed in Section 2699.5 shall commence only after the following requirements have been met:
(1)(A)The aggrieved employee or representative shall give written notice by online filing with the Labor and Workforce Development Agency and by certified mail to the employer of the specific provisions of this code alleged to have been violated, including the facts and theories to support the alleged violation.
(B)A notice filed with the Labor and Workforce Development Agency pursuant to subparagraph (A) and any employer response to that notice shall be accompanied by a filing fee of seventy-five dollars ($75). The fees required by this subparagraph are subject to waiver in accordance with the requirements of Sections 68632 and 68633 of the Government Code.
(C)The fees paid pursuant to subparagraph (B) shall be paid into the Labor and Workforce Development Fund and used for the purposes specified in subdivision (j) of Section 2699.
(2)(A)The agency shall notify the employer and the aggrieved employee or representative by certified mail that it does not intend to investigate the alleged violation within 60 calendar days of the postmark date of the notice received pursuant to paragraph (1). Upon receipt of that notice or if no notice is provided within 65 calendar days of the postmark date of the notice given pursuant to paragraph (1), the aggrieved employee may commence a civil action pursuant to Section 2699.
(B)If the agency intends to investigate the alleged violation, it shall notify the employer and the aggrieved employee or representative by certified mail of its decision within 65 calendar days of the postmark date of the notice received pursuant to paragraph (1). Within 120 calendar days of that decision, the agency may investigate the alleged violation and issue any appropriate citation. If the agency, during the course of its investigation, determines that additional time is necessary to complete the investigation, it may extend the time by not more than 60 additional calendar days and shall issue a notice of the extension. If the agency determines that no citation will be issued, it shall notify the employer and aggrieved employee of that decision within five business days thereof by certified mail. Upon receipt of that notice or if no citation is issued by the agency within the time limits prescribed by subparagraph (A) and this subparagraph or if the agency fails to provide timely or any notification, the aggrieved employee may commence a civil action pursuant to Section 2699.
(C)Notwithstanding any other provision of law, a plaintiff may as a matter of right amend an existing complaint to add a cause of action arising under this part at any time within 60 days of the time periods specified in this part.
(D)The time limits prescribed by this paragraph shall only apply if the notice required by paragraph (1) is filed with the agency on or after July 1, 2016. For notices submitted prior to July 1, 2016, the time limits in effect on the postmark date of the notice shall apply.
(b)A civil action by an aggrieved employee pursuant to subdivision (a) or (f) of Section 2699 alleging a violation of any provision of Division 5 (commencing with Section 6300) other than those listed in Section 2699.5 shall commence only after the following requirements have been met:
(1)The aggrieved employee or representative shall give notice by online filing with the Division of Occupational Safety and Health and by certified mail to the employer, with a copy to the Labor and Workforce Development Agency, of the specific provisions of Division 5 (commencing with Section 6300) alleged to have been violated, including the facts and theories to support the alleged violation.
(2)(A)The division shall inspect or investigate the alleged violation pursuant to the procedures specified in Division 5 (commencing with Section 6300).
(i)If the division issues a citation, the employee may not commence an action pursuant to Section 2699. The division shall notify the aggrieved employee and employer in writing within 14 calendar days of certifying that the employer has corrected the violation.
(ii)If by the end of the period for inspection or investigation provided for in Section 6317, the division fails to issue a citation and the aggrieved employee disputes that decision, the employee may challenge that decision in the superior court. In such an action, the superior court shall follow precedents of the Occupational Safety and Health Appeals Board. If the court finds that the division should have issued a citation and orders the division to issue a citation, then the aggrieved employee may not commence a civil action pursuant to Section 2699.
(iii)A complaint in superior court alleging a violation of Division 5 (commencing with Section 6300) other than those listed in Section 2699.5 shall include therewith a copy of the notice of violation provided to the division and employer pursuant to paragraph (1).
(iv)The superior court shall not dismiss the action for nonmaterial differences in facts or theories between those contained in the notice of violation provided to the division and employer pursuant to paragraph (1) and the complaint filed with the court.
(B)If the division fails to inspect or investigate the alleged violation as provided by Section 6309, the provisions of subdivision (c) shall apply to the determination of the alleged violation.
(3)(A)Nothing in this subdivision shall be construed to alter the authority of the division to permit long-term abatement periods or to enter into memoranda of understanding or joint agreements with employers in the case of long-term abatement issues.
(B)Nothing in this subdivision shall be construed to authorize an employee to file a notice or to commence a civil action pursuant to Section 2699 during the period that an employer has voluntarily entered into consultation with the division to ameliorate a condition in that particular worksite.
(C)An employer who has been provided notice pursuant to this section may not then enter into consultation with the division in order to avoid an action under this section.
(4)The superior court shall review and approve any proposed settlement of alleged violations of the provisions of Division 5 (commencing with Section 6300) to ensure that the settlement provisions are at least as effective as the protections or remedies provided by state and federal law or regulation for the alleged violation. The provisions of the settlement relating to health and safety laws shall be submitted to the division at the same time that they are submitted to the court. This requirement shall be construed to authorize and permit the division to comment on those settlement provisions, and the court shall grant the divisions commentary the appropriate weight.
(c)A civil action by an aggrieved employee pursuant to subdivision (a) or (f) of Section 2699 alleging a violation of any provision other than those listed in Section 2699.5 or Division 5 (commencing with Section 6300) shall commence only after the following requirements have been met:
(1)(A)The aggrieved employee or representative shall give written notice by online filing with the Labor and Workforce Development Agency and by certified mail to the employer of the specific provisions of this code alleged to have been violated, including the facts and theories to support the alleged violation.
(B)A notice filed with the Labor and Workforce Development Agency pursuant to subparagraph (A) and any employer response to that notice shall be accompanied by a filing fee of seventy-five dollars ($75). The fees required by this subparagraph are subject to waiver in accordance with the requirements of Sections 68632 and 68633 of the Government Code.
(C)The fees paid pursuant to subparagraph (B) shall be paid into the Labor and Workforce Development Fund and used for the purposes specified in subdivision (j) of Section 2699.
(2)(A)The employer may cure the alleged violation within 65 calendar days of the postmark date of the notice sent by the aggrieved employee or representative. The employer shall give written notice within that period of time by certified mail to the aggrieved employee or representative and by online filing with the agency if the alleged violation is cured, including a description of actions taken, and no civil action pursuant to Section 2699 may commence. If the alleged violation is not cured within the 65-day period, the employee may commence a civil action pursuant to Section 2699.
(B)(i)Subject to the limitation in clause (ii), no employer may avail himself or herself of the notice and cure provisions of this subdivision more than three times in a 12-month period for the same violation or violations contained in the notice, regardless of the location of the worksite.
(ii)No employer may avail himself or herself of the notice and cure provisions of this subdivision with respect to alleged violations of paragraph (6) or (8) of subdivision (a) of Section 226 more than once in a 12-month period for the same violation or violations contained in the notice, regardless of the location of the worksite.
(3)If the aggrieved employee disputes that the alleged violation has been cured, the aggrieved employee or representative shall provide written notice by online filing with the agency and by certified mail to the employer, including specified grounds to support that dispute, to the employer and the agency. Within 17 calendar days of the receipt of that notice, the agency shall review the actions taken by the employer to cure the alleged violation, and provide written notice of its decision by certified mail to the aggrieved employee and the employer. The agency may grant the employer three additional business days to cure the alleged violation. If the agency determines that the alleged violation has not been cured or if the agency fails to provide timely or any notification, the employee may proceed with the civil action pursuant to Section 2699. If the agency determines that the alleged violation has been cured, but the employee still disagrees, the employee may appeal that determination to the superior court.
(d)The periods specified in this section are not counted as part of the time limited for the commencement of the civil action to recover penalties under this part.
(e)This section shall remain in effect only until July 1, 2021, and as of that date is repealed, unless a later enacted statute, that is enacted before July 1, 2021, deletes or extends that date.
SEC. 2.Section 2699.3 of the Labor Code, as added by Section 191 of Chapter 31 of the Statutes of 2016, is amended to read:2699.3.(a)A civil action by an aggrieved employee pursuant to subdivision (a) or (f) of Section 2699 alleging a violation of any provision listed in Section 2699.5 shall commence only after the following requirements have been met:
(1)(A)The aggrieved employee or representative shall give written notice by online filing with the Labor and Workforce Development Agency and by certified mail to the employer of the specific provisions of this code alleged to have been violated, including the facts and theories to support the alleged violation.
(B)A notice filed with the Labor and Workforce Development Agency pursuant to subparagraph (A) and any employer response to that notice shall be accompanied by a filing fee of seventy-five dollars ($75). The fees required by this subparagraph are subject to waiver in accordance with the requirements of Sections 68632 and 68633 of the Government Code.
(C)The fees paid pursuant to subparagraph (B) shall be paid into the Labor and Workforce Development Fund and used for the purposes specified in subdivision (j) of Section 2699.
(2)(A)The agency shall notify the employer and the aggrieved employee or representative by certified mail that it does not intend to investigate the alleged violation within 60 calendar days of the postmark date of the notice received pursuant to paragraph (1). Upon receipt of that notice or if no notice is provided within 65 calendar days of the postmark date of the notice given pursuant to paragraph (1), the aggrieved employee may commence a civil action pursuant to Section 2699.
(B)If the agency intends to investigate the alleged violation, it shall notify the employer and the aggrieved employee or representative by certified mail of its decision within 65 calendar days of the postmark date of the notice received pursuant to paragraph (1). Within 120 calendar days of that decision, the agency may investigate the alleged violation and issue any appropriate citation. If the agency determines that no citation will be issued, it shall notify the employer and aggrieved employee of that decision within five business days thereof by certified mail. Upon receipt of that notice or if no citation is issued by the agency within the time limits prescribed by subparagraph (A) and this subparagraph or if the agency fails to provide timely or any notification, the aggrieved employee may commence a civil action pursuant to Section 2699.
(C)Notwithstanding any other provision of law, a plaintiff may as a matter of right amend an existing complaint to add a cause of action arising under this part at any time within 60 days of the time periods specified in this part.
(b)A civil action by an aggrieved employee pursuant to subdivision (a) or (f) of Section 2699 alleging a violation of any provision of Division 5 (commencing with Section 6300) other than those listed in Section 2699.5 shall commence only after the following requirements have been met:
(1)The aggrieved employee or representative shall give notice by online filing with the Division of Occupational Safety and Health and by certified mail to the employer, with a copy to the Labor and Workforce Development Agency, of the specific provisions of Division 5 (commencing with Section 6300) alleged to have been violated, including the facts and theories to support the alleged violation.
(2)(A)The division shall inspect or investigate the alleged violation pursuant to the procedures specified in Division 5 (commencing with Section 6300).
(i)If the division issues a citation, the employee may not commence an action pursuant to Section 2699. The division shall notify the aggrieved employee and employer in writing within 14 calendar days of certifying that the employer has corrected the violation.
(ii)If by the end of the period for inspection or investigation provided for in Section 6317, the division fails to issue a citation and the aggrieved employee disputes that decision, the employee may challenge that decision in the superior court. In such an action, the superior court shall follow precedents of the Occupational Safety and Health Appeals Board. If the court finds that the division should have issued a citation and orders the division to issue a citation, then the aggrieved employee may not commence a civil action pursuant to Section 2699.
(iii)A complaint in superior court alleging a violation of Division 5 (commencing with Section 6300) other than those listed in Section 2699.5 shall include therewith a copy of the notice of violation provided to the division and employer pursuant to paragraph (1).
(iv)The superior court shall not dismiss the action for nonmaterial differences in facts or theories between those contained in the notice of violation provided to the division and employer pursuant to paragraph (1) and the complaint filed with the court.
(B)If the division fails to inspect or investigate the alleged violation as provided by Section 6309, the provisions of subdivision (c) shall apply to the determination of the alleged violation.
(3)(A)Nothing in this subdivision shall be construed to alter the authority of the division to permit long-term abatement periods or to enter into memoranda of understanding or joint agreements with employers in the case of long-term abatement issues.
(B)Nothing in this subdivision shall be construed to authorize an employee to file a notice or to commence a civil action pursuant to Section 2699 during the period that an employer has voluntarily entered into consultation with the division to ameliorate a condition in that particular worksite.
(C)An employer who has been provided notice pursuant to this section may not then enter into consultation with the division in order to avoid an action under this section.
(4)The superior court shall review and approve any proposed settlement of alleged violations of the provisions of Division 5 (commencing with Section 6300) to ensure that the settlement provisions are at least as effective as the protections or remedies provided by state and federal law or regulation for the alleged violation. The provisions of the settlement relating to health and safety laws shall be submitted to the division at the same time that they are submitted to the court. This requirement shall be construed to authorize and permit the division to comment on those settlement provisions, and the court shall grant the divisions commentary the appropriate weight.
(c)A civil action by an aggrieved employee pursuant to subdivision (a) or (f) of Section 2699 alleging a violation of any provision other than those listed in Section 2699.5 or Division 5 (commencing with Section 6300) shall commence only after the following requirements have been met:
(1)(A)The aggrieved employee or representative shall give written notice by online filing with the Labor and Workforce Development Agency and by certified mail to the employer of the specific provisions of this code alleged to have been violated, including the facts and theories to support the alleged violation.
(B)A notice filed with the Labor and Workforce Development Agency pursuant to subparagraph (A) and any employer response to that notice shall be accompanied by a filing fee of seventy-five dollars ($75). The fees required by this subparagraph are subject to waiver in accordance with the requirements of Sections 68632 and 68633 of the Government Code.
(C)The fees paid pursuant to subparagraph (B) shall be paid into the Labor and Workforce Development Fund and used for the purposes specified in subdivision (j) of Section 2699.
(2)(A)The employer may cure the alleged violation within 65 calendar days of the postmark date of the notice sent by the aggrieved employee or representative. The employer shall give written notice within that period of time by certified mail to the aggrieved employee or representative and by online filing with the agency if the alleged violation is cured, including a description of actions taken, and no civil action pursuant to Section 2699 may commence. If the alleged violation is not cured within the 65-day period, the employee may commence a civil action pursuant to Section 2699.
(B)(i)Subject to the limitation in clause (ii), no employer may avail himself or herself of the notice and cure provisions of this subdivision more than three times in a 12-month period for the same violation or violations contained in the notice, regardless of the location of the worksite.
(ii)No employer may avail himself or herself of the notice and cure provisions of this subdivision with respect to alleged violations of paragraph (6) or (8) of subdivision (a) of Section 226 more than once in a 12-month period for the same violation or violations contained in the notice, regardless of the location of the worksite.
(3)If the aggrieved employee disputes that the alleged violation has been cured, the aggrieved employee or representative shall provide written notice by online filing with the agency and by certified mail to the employer, including specified grounds to support that dispute, to the employer and the agency. Within 17 calendar days of the receipt of that notice, the agency shall review the actions taken by the employer to cure the alleged violation, and provide written notice of its decision by certified mail to the aggrieved employee and the employer. The agency may grant the employer three additional business days to cure the alleged violation. If the agency determines that the alleged violation has not been cured or if the agency fails to provide timely or any notification, the employee may proceed with the civil action pursuant to Section 2699. If the agency determines that the alleged violation has been cured, but the employee still disagrees, the employee may appeal that determination to the superior court.
(d)The periods specified in this section are not counted as part of the time limited for the commencement of the civil action to recover penalties under this part.
(e)This section shall become operative on July 1, 2021.
SEC. 3.Section 2699.4 is added to the Labor Code, to read:2699.4.An aggrieved employee who brings an action pursuant to this part shall be awarded penalties based only upon violations by the employer actually suffered by that employee.(a)A civil action by an aggrieved employee pursuant to subdivision (a) or (f) of Section 2699 alleging a violation of any provision listed in Section 2699.5 shall commence only after the following requirements have been met:
(1)(A)The aggrieved employee or representative shall give written notice by online filing with the Labor and Workforce Development Agency and by certified mail to the employer of the specific provisions of this code alleged to have been violated, including the facts and theories to support the alleged violation.
(B)A notice filed with the Labor and Workforce Development Agency pursuant to subparagraph (A) and any employer response to that notice shall be accompanied by a filing fee of seventy-five dollars ($75). The fees required by this subparagraph are subject to waiver in accordance with the requirements of Sections 68632 and 68633 of the Government Code.
(C)The fees paid pursuant to subparagraph (B) shall be paid into the Labor and Workforce Development Fund and used for the purposes specified in subdivision (j) of Section 2699.
(2)(A)The agency shall notify the employer and the aggrieved employee or representative by certified mail that it does not intend to investigate the alleged violation within 60 calendar days of the postmark date of the notice received pursuant to paragraph (1). Upon receipt of that notice or if no notice is provided within 65 calendar days of the postmark date of the notice given pursuant to paragraph (1), the aggrieved employee may commence a civil action pursuant to Section 2699.
(B)If the agency intends to investigate the alleged violation, it shall notify the employer and the aggrieved employee or representative by certified mail of its decision within 65 calendar days of the postmark date of the notice received pursuant to paragraph (1). Within 120 calendar days of that decision, the agency may investigate the alleged violation and issue any appropriate citation. If the agency, during the course of its investigation, determines that additional time is necessary to complete the investigation, it may extend the time by not more than 60 additional calendar days and shall issue a notice of the extension. If the agency determines that no citation will be issued, it shall notify the employer and aggrieved employee of that decision within five business days thereof by certified mail. Upon receipt of that notice or if no citation is issued by the agency within the time limits prescribed by subparagraph (A) and this subparagraph or if the agency fails to provide timely or any notification, the aggrieved employee may commence a civil action pursuant to Section 2699.
(C)Notwithstanding any other provision of law, a plaintiff may as a matter of right amend an existing complaint to add a cause of action arising under this part at any time within 60 days of the time periods specified in this part.
(D)The time limits prescribed by this paragraph shall only apply if the notice required by paragraph (1) is filed with the agency on or after July 1, 2016. For notices submitted prior to July 1, 2016, the time limits in effect on the postmark date of the notice shall apply.
(b)A civil action by an aggrieved employee pursuant to subdivision (a) or (f) of Section 2699 alleging a violation of any provision of Division 5 (commencing with Section 6300) other than those listed in Section 2699.5 shall commence only after the following requirements have been met:
(1)The aggrieved employee or representative shall give notice by online filing with the Division of Occupational Safety and Health and by certified mail to the employer, with a copy to the Labor and Workforce Development Agency, of the specific provisions of Division 5 (commencing with Section 6300) alleged to have been violated, including the facts and theories to support the alleged violation.
(2)(A)The division shall inspect or investigate the alleged violation pursuant to the procedures specified in Division 5 (commencing with Section 6300).
(i)If the division issues a citation, the employee may not commence an action pursuant to Section 2699. The division shall notify the aggrieved employee and employer in writing within 14 calendar days of certifying that the employer has corrected the violation.
(ii)If by the end of the period for inspection or investigation provided for in Section 6317, the division fails to issue a citation and the aggrieved employee disputes that decision, the employee may challenge that decision in the superior court. In such an action, the superior court shall follow precedents of the Occupational Safety and Health Appeals Board. If the court finds that the division should have issued a citation and orders the division to issue a citation, then the aggrieved employee may not commence a civil action pursuant to Section 2699.
(iii)A complaint in superior court alleging a violation of Division 5 (commencing with Section 6300) other than those listed in Section 2699.5 shall include therewith a copy of the notice of violation provided to the division and employer pursuant to paragraph (1).
(iv)The superior court shall not dismiss the action for nonmaterial differences in facts or theories between those contained in the notice of violation provided to the division and employer pursuant to paragraph (1) and the complaint filed with the court.
(B)If the division fails to inspect or investigate the alleged violation as provided by Section 6309, the provisions of subdivision (c) shall apply to the determination of the alleged violation.
(3)(A)Nothing in this subdivision shall be construed to alter the authority of the division to permit long-term abatement periods or to enter into memoranda of understanding or joint agreements with employers in the case of long-term abatement issues.
(B)Nothing in this subdivision shall be construed to authorize an employee to file a notice or to commence a civil action pursuant to Section 2699 during the period that an employer has voluntarily entered into consultation with the division to ameliorate a condition in that particular worksite.
(C)An employer who has been provided notice pursuant to this section may not then enter into consultation with the division in order to avoid an action under this section.
(4)The superior court shall review and approve any proposed settlement of alleged violations of the provisions of Division 5 (commencing with Section 6300) to ensure that the settlement provisions are at least as effective as the protections or remedies provided by state and federal law or regulation for the alleged violation. The provisions of the settlement relating to health and safety laws shall be submitted to the division at the same time that they are submitted to the court. This requirement shall be construed to authorize and permit the division to comment on those settlement provisions, and the court shall grant the divisions commentary the appropriate weight.
(c)A civil action by an aggrieved employee pursuant to subdivision (a) or (f) of Section 2699 alleging a violation of any provision other than those listed in Section 2699.5 or Division 5 (commencing with Section 6300) shall commence only after the following requirements have been met:
(1)(A)The aggrieved employee or representative shall give written notice by online filing with the Labor and Workforce Development Agency and by certified mail to the employer of the specific provisions of this code alleged to have been violated, including the facts and theories to support the alleged violation.
(B)A notice filed with the Labor and Workforce Development Agency pursuant to subparagraph (A) and any employer response to that notice shall be accompanied by a filing fee of seventy-five dollars ($75). The fees required by this subparagraph are subject to waiver in accordance with the requirements of Sections 68632 and 68633 of the Government Code.
(C)The fees paid pursuant to subparagraph (B) shall be paid into the Labor and Workforce Development Fund and used for the purposes specified in subdivision (j) of Section 2699.
(2)(A)The employer may cure the alleged violation within 33 65 calendar days of the postmark date of the notice sent by the aggrieved employee or representative. The employer shall give written notice within that period of time by certified mail to the aggrieved employee or representative and by online filing with the agency if the alleged violation is cured, including a description of actions taken, and no civil action pursuant to Section 2699 may commence. If the alleged violation is not cured within the 33-day 65-day period, the employee may commence a civil action pursuant to Section 2699.
(B)(i)Subject to the limitation in clause (ii), no employer may avail himself or herself of the notice and cure provisions of this subdivision more than three times in a 12-month period for the same violation or violations contained in the notice, regardless of the location of the worksite.
(ii)No employer may avail himself or herself of the notice and cure provisions of this subdivision with respect to alleged violations of paragraph (6) or (8) of subdivision (a) of Section 226 more than once in a 12-month period for the same violation or violations contained in the notice, regardless of the location of the worksite.
(3)If the aggrieved employee disputes that the alleged violation has been cured, the aggrieved employee or representative shall provide written notice by online filing with the agency and by certified mail to the employer, including specified grounds to support that dispute, to the employer and the agency. Within 17 calendar days of the receipt of that notice, the agency shall review the actions taken by the employer to cure the alleged violation, and provide written notice of its decision by certified mail to the aggrieved employee and the employer. The agency may grant the employer three additional business days to cure the alleged violation. If the agency determines that the alleged violation has not been cured or if the agency fails to provide timely or any notification, the employee may proceed with the civil action pursuant to Section 2699. If the agency determines that the alleged violation has been cured, but the employee still disagrees, the employee may appeal that determination to the superior court.
(d)The periods specified in this section are not counted as part of the time limited for the commencement of the civil action to recover penalties under this part.
(e)This section shall remain in effect only until July 1, 2021, and as of that date is repealed, unless a later enacted statute, that is enacted before July 1, 2021, deletes or extends that date.
SEC. 2.Section 2699.3 of the Labor Code, as added by Section 191 of Chapter 31 of the Statutes of 2016, is amended to read:2699.3.(a)A civil action by an aggrieved employee pursuant to subdivision (a) or (f) of Section 2699 alleging a violation of any provision listed in Section 2699.5 shall commence only after the following requirements have been met:
(1)(A)The aggrieved employee or representative shall give written notice by online filing with the Labor and Workforce Development Agency and by certified mail to the employer of the specific provisions of this code alleged to have been violated, including the facts and theories to support the alleged violation.
(B)A notice filed with the Labor and Workforce Development Agency pursuant to subparagraph (A) and any employer response to that notice shall be accompanied by a filing fee of seventy-five dollars ($75). The fees required by this subparagraph are subject to waiver in accordance with the requirements of Sections 68632 and 68633 of the Government Code.
(C)The fees paid pursuant to subparagraph (B) shall be paid into the Labor and Workforce Development Fund and used for the purposes specified in subdivision (j) of Section 2699.
(2)(A)The agency shall notify the employer and the aggrieved employee or representative by certified mail that it does not intend to investigate the alleged violation within 60 calendar days of the postmark date of the notice received pursuant to paragraph (1). Upon receipt of that notice or if no notice is provided within 65 calendar days of the postmark date of the notice given pursuant to paragraph (1), the aggrieved employee may commence a civil action pursuant to Section 2699.
(B)If the agency intends to investigate the alleged violation, it shall notify the employer and the aggrieved employee or representative by certified mail of its decision within 65 calendar days of the postmark date of the notice received pursuant to paragraph (1). Within 120 calendar days of that decision, the agency may investigate the alleged violation and issue any appropriate citation. If the agency determines that no citation will be issued, it shall notify the employer and aggrieved employee of that decision within five business days thereof by certified mail. Upon receipt of that notice or if no citation is issued by the agency within the time limits prescribed by subparagraph (A) and this subparagraph or if the agency fails to provide timely or any notification, the aggrieved employee may commence a civil action pursuant to Section 2699.
(C)Notwithstanding any other provision of law, a plaintiff may as a matter of right amend an existing complaint to add a cause of action arising under this part at any time within 60 days of the time periods specified in this part.
(b)A civil action by an aggrieved employee pursuant to subdivision (a) or (f) of Section 2699 alleging a violation of any provision of Division 5 (commencing with Section 6300) other than those listed in Section 2699.5 shall commence only after the following requirements have been met:
(1)The aggrieved employee or representative shall give notice by online filing with the Division of Occupational Safety and Health and by certified mail to the employer, with a copy to the Labor and Workforce Development Agency, of the specific provisions of Division 5 (commencing with Section 6300) alleged to have been violated, including the facts and theories to support the alleged violation.
(2)(A)The division shall inspect or investigate the alleged violation pursuant to the procedures specified in Division 5 (commencing with Section 6300).
(i)If the division issues a citation, the employee may not commence an action pursuant to Section 2699. The division shall notify the aggrieved employee and employer in writing within 14 calendar days of certifying that the employer has corrected the violation.
(ii)If by the end of the period for inspection or investigation provided for in Section 6317, the division fails to issue a citation and the aggrieved employee disputes that decision, the employee may challenge that decision in the superior court. In such an action, the superior court shall follow precedents of the Occupational Safety and Health Appeals Board. If the court finds that the division should have issued a citation and orders the division to issue a citation, then the aggrieved employee may not commence a civil action pursuant to Section 2699.
(iii)A complaint in superior court alleging a violation of Division 5 (commencing with Section 6300) other than those listed in Section 2699.5 shall include therewith a copy of the notice of violation provided to the division and employer pursuant to paragraph (1).
(iv)The superior court shall not dismiss the action for nonmaterial differences in facts or theories between those contained in the notice of violation provided to the division and employer pursuant to paragraph (1) and the complaint filed with the court.
(B)If the division fails to inspect or investigate the alleged violation as provided by Section 6309, the provisions of subdivision (c) shall apply to the determination of the alleged violation.
(3)(A)Nothing in this subdivision shall be construed to alter the authority of the division to permit long-term abatement periods or to enter into memoranda of understanding or joint agreements with employers in the case of long-term abatement issues.
(B)Nothing in this subdivision shall be construed to authorize an employee to file a notice or to commence a civil action pursuant to Section 2699 during the period that an employer has voluntarily entered into consultation with the division to ameliorate a condition in that particular worksite.
(C)An employer who has been provided notice pursuant to this section may not then enter into consultation with the division in order to avoid an action under this section.
(4)The superior court shall review and approve any proposed settlement of alleged violations of the provisions of Division 5 (commencing with Section 6300) to ensure that the settlement provisions are at least as effective as the protections or remedies provided by state and federal law or regulation for the alleged violation. The provisions of the settlement relating to health and safety laws shall be submitted to the division at the same time that they are submitted to the court. This requirement shall be construed to authorize and permit the division to comment on those settlement provisions, and the court shall grant the divisions commentary the appropriate weight.
(c)A civil action by an aggrieved employee pursuant to subdivision (a) or (f) of Section 2699 alleging a violation of any provision other than those listed in Section 2699.5 or Division 5 (commencing with Section 6300) shall commence only after the following requirements have been met:
(1)(A)The aggrieved employee or representative shall give written notice by online filing with the Labor and Workforce Development Agency and by certified mail to the employer of the specific provisions of this code alleged to have been violated, including the facts and theories to support the alleged violation.
(B)A notice filed with the Labor and Workforce Development Agency pursuant to subparagraph (A) and any employer response to that notice shall be accompanied by a filing fee of seventy-five dollars ($75). The fees required by this subparagraph are subject to waiver in accordance with the requirements of Sections 68632 and 68633 of the Government Code.
(C)The fees paid pursuant to subparagraph (B) shall be paid into the Labor and Workforce Development Fund and used for the purposes specified in subdivision (j) of Section 2699.
(2)(A)The employer may cure the alleged violation within 33 65 calendar days of the postmark date of the notice sent by the aggrieved employee or representative. The employer shall give written notice within that period of time by certified mail to the aggrieved employee or representative and by online filing with the agency if the alleged violation is cured, including a description of actions taken, and no civil action pursuant to Section 2699 may commence. If the alleged violation is not cured within the 33-day 65-day period, the employee may commence a civil action pursuant to Section 2699.
(B)(i)Subject to the limitation in clause (ii), no employer may avail himself or herself of the notice and cure provisions of this subdivision more than three times in a 12-month period for the same violation or violations contained in the notice, regardless of the location of the worksite.
(ii)No employer may avail himself or herself of the notice and cure provisions of this subdivision with respect to alleged violations of paragraph (6) or (8) of subdivision (a) of Section 226 more than once in a 12-month period for the same violation or violations contained in the notice, regardless of the location of the worksite.
(3)If the aggrieved employee disputes that the alleged violation has been cured, the aggrieved employee or representative shall provide written notice by online filing with the agency and by certified mail to the employer, including specified grounds to support that dispute, to the employer and the agency. Within 17 calendar days of the receipt of that notice, the agency shall review the actions taken by the employer to cure the alleged violation, and provide written notice of its decision by certified mail to the aggrieved employee and the employer. The agency may grant the employer three additional business days to cure the alleged violation. If the agency determines that the alleged violation has not been cured or if the agency fails to provide timely or any notification, the employee may proceed with the civil action pursuant to Section 2699. If the agency determines that the alleged violation has been cured, but the employee still disagrees, the employee may appeal that determination to the superior court.
(d)The periods specified in this section are not counted as part of the time limited for the commencement of the civil action to recover penalties under this part.
(e)This section shall become operative on July 1, 2021.
SEC. 3.Section 2699.4 is added to the Labor Code, to read:2699.4.An aggrieved employee who brings an action pursuant to this part shall be awarded penalties based only upon violations by the employer actually suffered by that employee.
|
Date
|
Status
|
|---|---|
| Feb 1, 2018 | From committee: Filed with the Chief Clerk pursuant to Joint Rule 56. |
| Jan 31, 2018 | Died pursuant to Art. IV, Sec. 10(c) of the Constitution. |
| Jan 11, 2018 | In committee: Set, second hearing. Hearing canceled at the request of author. |
| Jan 8, 2018 | Assembly Rule 56 suspended. |
| May 3, 2017 | In committee: Set, first hearing. Hearing canceled at the request of author. |
| Apr 27, 2017 | Re-referred to Com. on L. & E. |
| Apr 26, 2017 | From committee chair, with author's amendments: Amend, and re-refer to Com. on L. & E. Read second time and amended. |
| Feb 13, 2017 | Referred to Coms. on L. & E. and JUD. |
| Feb 3, 2017 | From printer. May be heard in committee March 5. |
| Feb 2, 2017 | Read first time. To print. |
This list shows positions taken on this bill by organizations on the date displayed, which is linked to the original source.
Positions by individuals are not included.
|
Organization
|
Position
|
Date
|
|---|---|---|
| African American Farmers of California | ** Support | Jan 10, 2018 |
| Almond Alliance of California | ** Support | Jan 10, 2018 |
| American Insurance Association | ** Support | Jan 10, 2018 |
| American Petroleum and Convenience Store Association | ** Support | Jan 10, 2018 |
| American Pistachio Growers | ** Support | Jan 10, 2018 |
| Associated General Contractors | ** Support | Jan 10, 2018 |
| Association Of California Egg Farmers | ** Support | Jan 10, 2018 |
| Brea Chamber of Commerce | ** Support | Jan 10, 2018 |
| CA Conference Board of the Amalgamated Transit Union | ** Against | Jan 10, 2018 |
| CA Conference of Machinists | ** Against | Jan 10, 2018 |
| California Ambulance Association | ** Support | Jan 10, 2018 |
| California Apartment Association | ** Support | Jan 10, 2018 |
| California Assisted Living Association | ** Support | Jan 10, 2018 |
| California Association Of Health Facilities | ** Support | Jan 10, 2018 |
| California Association Of Wheat Growers | ** Support | Jan 10, 2018 |
| California Association Of Winegrape Growers | ** Support | Jan 10, 2018 |
| California Attractions And Parks Association | ** Support | Jan 10, 2018 |
| California Bankers Association | ** Support | Jan 10, 2018 |
| California Beer and Beverage Distributors | ** Support | Jan 10, 2018 |
| California Blueberry Association | ** Support | Jan 10, 2018 |
| California Building Industry Association | ** Support | Jan 10, 2018 |
| California Chamber Of Commerce | ** Support | Jan 10, 2018 |
| California Chapters of American Fire Sprinkler Association | ** Support | Jan 10, 2018 |
| California Delivery Association | ** Support | Jan 10, 2018 |
| California Employment Lawyers Association | ** Against | Jan 10, 2018 |
| California Farm Bureau Federation | ** Support | Jan 10, 2018 |
| California Framing Contractors Association | ** Support | Jan 10, 2018 |
| California Fresh Fruit Association | ** Support | Jan 10, 2018 |
| California Grain and Feed Association | ** Support | Jan 10, 2018 |
| California Hospital Association | ** Support | Jan 10, 2018 |
| California Hotel and Lodging Association | ** Support | Jan 10, 2018 |
| California Labor Federation, Afl-Cio | ** Against | Jan 10, 2018 |
| California League of Food Processors | ** Support | Jan 10, 2018 |
| California Manufacturers And Technology Association | ** Support | Jan 10, 2018 |
| California Nurses Association | ** Against | Jan 10, 2018 |
| California Pear Growers Association | ** Support | Jan 10, 2018 |
| California Pool and Spa Association | ** Support | Jan 10, 2018 |
| California Professional Firefighters | ** Against | Jan 10, 2018 |
| California Retailers Association | ** Support | Jan 10, 2018 |
| California Rural Legal Assistance Foundation | ** Against | Jan 10, 2018 |
| California Seed Association | ** Support | Jan 10, 2018 |
| California Ski Industry Association | ** Support | Jan 10, 2018 |
| California State Association Of Counties | ** Support | Jan 10, 2018 |
| California State Floral Association | ** Support | Jan 10, 2018 |
| California Strawberry Commission | ** Support | Jan 10, 2018 |
| California Teamsters Public Affairs Council | ** Against | Jan 10, 2018 |
| California Travel Association | ** Support | Jan 10, 2018 |
| California Trucking Association | ** Support | Jan 10, 2018 |
| California Warehouse Association Camarillo Chamber of Commerce | ** Support | Jan 10, 2018 |
| Cerritos Regional Chamber of Commerce | ** Support | Jan 10, 2018 |
| Citizens Against Lawsuit Abuse | ** Support | Jan 10, 2018 |
| Civil Justice Association Of California | ** Support | Jan 10, 2018 |
| Construction Employers' Association | ** Support | Jan 10, 2018 |
| Consumer Attorneys Of California | ** Against | Jan 10, 2018 |
| Culver City Chamber of Commerce | ** Support | Jan 10, 2018 |
| Engineers & Scientists of CA, Local 20 | ** Against | Jan 10, 2018 |
| Family Business Association of California | ** Support | Jan 10, 2018 |
| Far West Equipment Dealers Association | ** Support | Jan 10, 2018 |
| Gateway Chambers Alliance | ** Support | Jan 10, 2018 |
| Greater Bakersfield Chamber of Commerce | ** Support | Jan 10, 2018 |
| Independent Insurance Agents and Brokers of California | ** Support | Jan 10, 2018 |
| Independent Roofing Contractors of California, Inc. | ** Support | Jan 10, 2018 |
| International Longshore & Warehouse Union | ** Against | Jan 10, 2018 |
| League Of California Cities | ** Support | Jan 10, 2018 |
| Murrieta Chamber of Commerce | ** Support | Jan 10, 2018 |
| National Federation Of Independent Business | ** Support | Jan 10, 2018 |
| National Nurses United | ** Against | Jan 10, 2018 |
| Nisei Farmers League | ** Support | Jan 10, 2018 |
| North Orange County Chamber of Commerce | ** Support | Jan 10, 2018 |
| Oceanside Chamber of Commerce | ** Support | Jan 10, 2018 |
| Orange County Business Council | ** Support | Jan 10, 2018 |
| Oxnard Chamber of Commerce | ** Support | Jan 10, 2018 |
| Pacific Association Of Building Service Contractors | ** Support | Jan 10, 2018 |
| Pacific Egg & Poultry Association | ** Support | Jan 10, 2018 |
| Palm Desert Area Chamber of Commerce | ** Support | Jan 10, 2018 |
| Plumbing-Heating-Cooling Contractors Association of California | ** Support | Jan 10, 2018 |
| Professional & Technical Engineers, Local 21 | ** Against | Jan 10, 2018 |
| Rancho Cordova Chamber of Commerce | ** Support | Jan 10, 2018 |
| Redondo Beach Chamber of Commerce & Visitors Bureau | ** Support | Jan 10, 2018 |
| Retail Industry Leaders Association | ** Support | Jan 10, 2018 |
| San Gabriel Valley Economic Partnership | ** Support | Jan 10, 2018 |
| Santa Maria Valley Chamber of Commerce | ** Support | Jan 10, 2018 |
| SEIU California | ** Against | Jan 10, 2018 |
| South Bay Association of Chambers of Commerce | ** Support | Jan 10, 2018 |
| Southwest California Legislative Council | ** Support | Jan 10, 2018 |
| Torrance Area Chamber of Commerce | ** Support | Jan 10, 2018 |
| Tulare Chamber of Commerce | ** Support | Jan 10, 2018 |
| UNITE-HERE | ** Against | Jan 10, 2018 |
| Utility Workers Union of America | ** Against | Jan 10, 2018 |
| VALLEY INDUSTRY AND COMMERCE ASSOCIATION | ** Support | Jan 10, 2018 |
| Western Carwash Association | ** Support | Jan 10, 2018 |
| Western Electrical Contractors Association | ** Support | Jan 10, 2018 |
| Western Growers Association | ** Support | Jan 10, 2018 |
| Western Manufactured Housing Communities Association | ** Support | Jan 10, 2018 |
| Western Plant Health Association | ** Support | Jan 10, 2018 |
| Wine Institute | ** Support | Jan 10, 2018 |
Date of Hearing: January 11, 2018
ASSEMBLY COMMITTEE ON LABOR AND EMPLOYMENT
Tony Thurmond, Chair
ABPCA Bill Id:AB 281 (
Author:Salas) – As Amended Ver:April 26, 2017
SUBJECT: Labor Code Private Attorneys General Act of 2004: right to cure
SUMMARY: Extends the period of time in which an employer may cure violations of the Labor Code enforced by the Labor Code Private Attorneys General Act of 2004 (PAGA) from 33 to 65 calendar days.
EXISTING LAW:
- Authorizes, through PAGA, an aggrieved employee who complies with specified notice and filing requirements to bring a civil action to recover specified civil penalties that would otherwise be assessed and collected by the Labor and Workforce Development Agency (LWDA).
- Provides that an employee who prevails in an action under these provisions is entitled to recover his or her filing fees and reasonable attorney’s fees and costs.
- Provides that civil penalties may be assessed against the employer, as provided.
- Provides an employer a right to cure violations under the PAGA before the aggrieved employee may bring a civil action.
- Requires the employer to cure a violation within 33 calendar days of the postmark date of the notice sent by the aggrieved employee or representative.
- Excludes from the right to cure provisions, under PAGA, various specified violations and other specified health and safety violations.
FISCAL EFFECT: None. This bill is keyed non-fiscal by the Legislative Counsel.
COMMENTS:
The author argues AB 281 seeks to curb abusive PAGA litigation and asserts, “PAGA lawsuits can create hundreds of thousands, if not millions, of dollars in potential liability for employers... If more than one violation occurs, the penalties multiply. On top of these penalties, an employer is liable for a prevailing PAGA employee’s attorneys’ fees and costs as well as its own. Many businesses see no other choice but to pay expensive settlements, file for bankruptcy, lay off workers, or move out of state.”
General Background on PAGA
PAGA was enacted pursuant to SB 796 (Dunn), Chapter 906, Statutes of 2003, and went into effect on January 1, 2004. SB 796 assigned civil fine amounts to the large number of Labor Code provisions, which previously carried prohibitions or criminal fines, but not civil penalties. It also authorized the filing of civil actions to recover civil penalties by aggrieved workers acting as private attorneys general.
The next year, PAGA was further refined by SB 1809 (Dunn), Chapter 221, Statutes of 2004. SB 1809 significantly revised the provisions of the PAGA by enacting specified procedural and administrative requirements that must be met prior to bringing a private action to recover civil penalties. SB 1809 essentially enacted three different procedural requirements depending on the type of violation; occupational safety and health violations, “serious” Labor Code violations, and a notice and cure provision for the other Labor Code violations not considered serious or related to occupational safety and health.
The provisions of SB 1809 also expanded judicial review of PAGA claims by requiring courts to review and approve any penalties sought as part of a proposed settlement agreement, and those portions of settlements concerning violations of health and safety laws. In addition, courts were authorized to award a lesser amount if to do so otherwise would result in an award that is unjust, arbitrary and oppressive, or confiscatory.
SB 1809 also provided that no action shall be brought for a posting, notice, agency reporting, or filing requirement, except as specified.
Finally, SB 1809 appropriated $150,000 from the General Fund to the LWDA for the purposes of implementing its provisions, and changed the prior penalty formula to provide that 75 percent of most civil penalties recovered pursuant to PAGA shall go to the LWDA for labor law enforcement and education.
Notice and Cure Provisions of PAGA
This legislation amends the procedural requirements for the notice and cure provisions of PAGA that address Labor Code violations not considered serious or related to occupational safety and health.
For these violations, the following procedural requirements apply under current law:
- The aggrieved employee shall give written notice by online filing with the LWDA and by certified mail to the employer of the specific provisions of the Labor Code alleged to have been violated.
- The notice filed with the LWDA and the employer’s response to that notice shall be accompanied by a $75 filing fee.
- The employer may cure the alleged violation within 33 days and give written notice to the employee and the LWDA if the alleged violation is cured.
- If the alleged violation is not cured within the 33-day period, the aggrieved employee may commence a civil action pursuant to PAGA. For the aggrieved employee to dispute that the alleged violation has been cured, the employee must provide written notice to the employer and the LWDA. Within 17 days the LWDA must review the actions of the employer and provide written notice of whether the alleged violation has been cured.
- If the LWDA determines that the alleged violation has not been cured or if the agency fails to provide timely or any notification, the aggrieved employee may proceed with a civil action pursuant to PAGA. If the agency has determined that the alleged violation has been cured, but the employee still disagrees, the employee may appeal that determination to the superior court.
- No employer may use these "notice and cure" provisions more than three times in a 12-month period for the same violation or violations contained in the notice, regardless of the location of the worksite.
This bill extends the time period for curing these types of labor code violations from 33 to 65 calendar days.
Recent PAGA Reform
In 2015, the Governor signed AB 1506 (R. Hernández), Chapter 445, Statutes of 2015, which provides an employer with the right to cure a violation of failing to provide its employees with a wage statement containing the inclusive dates of the pay period and the name and address of the legal entity that is the employer.
In 2016, a budget trailer bill, SB 836 (Committee on Budget), Chapter 31, Statutes of 2016, made further revisions to PAGA and increased enforcement funding for the Labor Commissioner. That legislation requires a copy of a proposed settlement to be submitted to LWDA at same that it is submitted to court, and requires parties to provide the LWDA with a copy of the court’s judgement. The bill also extends various time lines, including the time LWDA reviews new cases from 30 to 60 days and the time for LWDA to notify parties of intent to investigate violation from 33 to 65 days. It also provided LWDA with an option to send notice to extend the 120 day time limit for investigating and citing the employer by an additional 60 days and sunsets this 60 day extension on July 1, 2021. The measure also included a $75 filing fee for new case notices and any employer responses to such notices, and required online filing and transmission of all items submitted to the LWDA.
Arguments in Support
The California Chamber of Commerce and a coalition of others argue, “California has some of the most onerous and complex labor laws in the country. This complexity is exemplified by PAGA, which essentially allows an individual to pursue a “representative action” on behalf of similarly aggrieved employees against an employer for almost any Labor Code violation. PAGA requires a $100 penalty per employee, per pay period for the first violation, and $200 per employee, per pay period for each subsequent violation. If there are multiple Labor Code violations, then these penalties are stacked. In addition, if the employee recovers any dollar amount, the employee is entitled to attorney’s fees, which adds another layer of cost onto the employer. “
The Chamber continues, “AB 281 would mitigate this financial threat of frivolous litigation by allowing an employer 65 days in which to cure a limited list of alleged violations before a plaintiff can pursue civil litigation, instead of current law that only provides 33 days. This is beneficial to both the employer and employee. For the employer, it eliminates the threat of costly civil litigation for an unintentional error for which it was not aware. For the employee, it provides an efficient remedy to an alleged violation. Notably, AB 281 only impacts a PAGA claim. For many of the Labor Code violations, there would still be an individual private right of action for an employee to pursue for the alleged violation. AB 281 creates a balance between protecting employees and their rights under the Labor Code while also protecting employers from financially devastating litigation over alleged minor violations.”
Arguments in Opposition
The California Labor Federation writes, “A right to cure typically has the effect of eliminating an employer’s financial incentive to follow the law because in the unlikely event they get caught cheating, he or she would face no penalties. Basically, employers may break the law until caught and only then be required to comply and make workers whole. It eliminates the deterrent to follow the law and in fact may result in significantly more violations of basic workers’ rights.”
The California Labor Federation continues, “AB 281 would almost double employers’ right to cure timeframe, extending it to 65-days. This would only drag out the time period within which an employer must remedy the labor code violations and make the workers whole. A longer cure period would increase the time employers are out of compliance with the law and increase the harm to workers. This is especially true in low-wage and immigrant workforce.”
The California Rural Legal Assistance Foundations (CRLAF), who was one of the original sponsors of the legislation creating PAGA writes, “CRLAF has agreed to a number of amendments to PAGA to address perceived problems with the statute over the past ten years. Most recently, we worked with the Brown Administration to reform several aspects of PAGA (e.g., mandatory court approval of settlements; extended periods of time for administrative review of potential PAGA claims; and creation of a PAGA unit within the LWDA to scrutinize ‘abusive’ PAGA lawsuits). At no time during those discussions did the issue of a perceived inadequacy of existing cure provisions arise. It is for that reason that we believe AB 281’s changes are unnecessary and unwarranted.”
The California Employment Lawyers Association (CELA) writes, “We are not aware of any evidence to support the need to extend the time frame for these types of PAGA claims. The proposed 65-day cure period would only drag out the time period within which an employer must remedy the labor code violations and make the employees whole. A longer cure period would also delay prosecution of meritorious claims to the great harm of workers. This is especially true in low-wage jobs, where employee turnover is high and witnesses and victims of the alleged Labor Code violations are more transient.”
Proposed PAGA Initiatives in Circulation.
On December 13, 2017 the Secretary of State announced that three initiatives related to PAGA had received title and summary and were eligible for circulation. The proponent of the measures, Sean McNally, must collect the signatures of 365,880 registered voters (five percent of the total votes cast for Governor in the November 2014 general election) for each proposed ballot initiative in order to qualify it for the ballot. The proponent has 180 days to circulate petitions for the measure, meaning the signatures must be submitted to county elections officials no later than June 11, 2018. The Attorney General’s official title and summary for the measures are as follows:
Initiative #17-0035:
ELIMINATES WORKERS’ AUTHORITY TO RECOVER PENALTIES FROM OFFENDING EMPLOYERS FOR STATE LABOR-LAW VIOLATIONS. LIMITS PENALTIES FOR LABOR-LAW VIOLATIONS. INITIATIVE STATUTE. Repeals current law that permits employees to file lawsuits on behalf of themselves and other aggrieved employees to recover monetary penalties for violations of state labor laws, including laws governing unpaid wages. Limits penalties State may assess for labor-law violations, changes State’s share of assessed penalties from 75 to 50 percent, and exempts employers from penalties in certain circumstances. Summary of estimate by Legislative Analyst and Director of Finance of fiscal impact on state and local government: Net reduction in state trial court costs that could reach the low tens of millions of dollars annually. Reduction in state penalty revenue used for labor law enforcement in the low tens of millions of dollars annually. Likely minor net impact on state administrative costs to enforce labor laws. (17-0035.)
Initiative #17-0036:
LIMITS WORKERS’ AUTHORITY TO RECOVER PENALTIES FROM OFFENDING EMPLOYERS FOR STATE LABOR-LAW VIOLATIONS. INITIATIVE STATUTE. Limits current law that permits employees to file lawsuits on behalf of themselves and other aggrieved employees to recover monetary penalties for violations of state labor laws, including laws governing unpaid wages. Changes State’s share of assessed penalties from 75 to 50 percent and exempts employers from penalties in certain circumstances. Prohibits contingency-fee arrangements and limits hourly rates for attorneys representing employees. Limits information employers must disclose. Summary of estimate by Legislative Analyst and Director of Finance of fiscal impact on state and local government: Net reduction in state trial court costs that would likely be in the millions of dollars annually, but could reach the low tens of millions of dollars annually. Reduction in state revenue used for labor law enforcement potentially up to the low tens of millions of dollars annually. Likely minor net impact on state administrative costs to enforce labor laws. (17-0036.)
Initiative #17-0037:
LIMITS WORKERS’ AUTHORITY TO RECOVER PENALTIES FROM OFFENDING EMPLOYERS FOR STATE LABOR-LAW VIOLATIONS. INITIATIVE STATUTE. Limits current law that permits employees to file lawsuits on behalf of themselves and other aggrieved employees to recover monetary penalties for violations of state labor laws, including laws governing unpaid wages. Changes State’s share of assessed penalties from 75 to 50 percent and exempts employers from penalties in certain circumstances. Limits contingency-fee arrangements for attorneys representing employees. Limits information employers must disclose. Summary of estimate by Legislative Analyst and Director of Finance of fiscal impact on state and local government: Net reduction in state trial court costs that would likely be in the millions of dollars annually, but could reach the low tens of millions of dollars annually. Reduction in state revenue used for labor law enforcement potentially up to the low tens of millions of dollars annually. Likely minor net impact on state administrative costs to enforce labor laws. (17-0037.)
Previous Legislation
SB 836 (Committee on Budget), Chapter 31, Statutes of 2016. Among other provisions, this budget trailer bill made several changes to PAGA, including an extension of the time period for LWDA to review and investigate PAGA claims. SB 836 also requires a copy of proposed settlement of a PAGA claim to be submitted to LWDA at same that it is submitted to court, and requires parties to provide the LWDA with a copy of the court’s judgement.
AB 1506 (R. Hernández), Chapter 445, Statutes of 2015. Provides an employer with the right to cure a violation of failing to provide its employees with a wage statement containing the inclusive dates of the pay period and the name and address of the legal entity that is the employer.
SB 1255 (Wright), Chapter 843, Statutes of 2012. Provides a statutory definition of what constitutes “suffering injury” for purposes of recovering damages pursuant to the itemized wage statements requirements including failure by the employer to provide a wage statement or failure to provide accurate or complete information regarding the other specified items, as specified.
SB 899 (Poochigian), Chapter 34, Statutes of 2004. Exempted workers compensation provisions of the Labor Code from enforcement through PAGA.
SB 1809 (Dunn), Chapter 221, Statutes of 2004. Significantly amended the Labor Code Private Attorney General Act of 2004by enacting specified procedural and administrative requirements that must be met prior to bringing a private action to recover civil penalties for Labor Code violations.
SB 796 (Dunn), Chapter 906, Statutes of 2003. Created an alternative private attorney general system for labor law enforcement in order to augment the enforcement abilities of the Labor Commissioner. Allows employees to sue their employers for civil penalties for employment law violations.
This measure is double-referred to Assembly Judiciary Committee should it pass this Committee.
REGISTERED SUPPORT / OPPOSITION:
Support
California Chamber of Commerce
African American Farmers of California
Almond Alliance of California
American Insurance Association
American Petroleum and Convenience Store Association
American Pistachio Growers
Associated Builders and Contractors – Central and Southern California Chapters and San Diego
Chapters
Associated General Contractors
Association of California Egg Farmers
Brea Chamber of Commerce
California Ambulance Association
California Apartment Association
California Assisted Living Association
California Association of Health Facilities
California Association of Wheat Growers
California Association of Winegrape Growers
California Attractions and Parks Association
California Bankers Association
California Beer and Beverage Distributors
California Blueberry Association
California Building Industry Association
California Chapters of American Fire Sprinkler Association
California Delivery Association
California Farm Bureau Federation
California Framing Contractors Association
California Fresh Fruit Association
California Grain and Feed Association
California Hospital Association
California Hotel and Lodging Association
California League of Food Processors
California Manufacturers and Technology Association
California Pear Growers Association
California Pool and Spa Association
California Professional Association of Specialty Contractors
California Restaurant Association
California Retailers Association
California Seed Association
California Ski Industry Association
California State Association of Counties
California State Council for the Society for Human Resource Management
California State Floral Association
California Strawberry Commission
California Travel Association
California Trucking Association
California Warehouse Association
Camarillo Chamber of Commerce
Cerritos Regional Chamber of Commerce
Citizens Against Lawsuit Abuse
Civil Justice Association of California
Construction Employers' Association
Culver City Chamber of Commerce
Family Business Association of California
Far West Equipment Dealers Association
Gateway Chambers Alliance
Greater Bakersfield Chamber of Commerce
Independent Insurance Agents and Brokers of California
Independent Roofing Contractors of California, Inc.
League of California Cities
Murrieta Chamber of Commerce
National Federation of Independent Business
Nisei Farmers League
North Orange County Chamber of Commerce
Oceanside Chamber of Commerce
Orange County Business Council
Oxnard Chamber of Commerce
Rancho Cordova Chamber of Commerce
Redondo Beach Chamber of Commerce & Visitors Bureau
Retail Industry Leaders Association
Pacific Association of Building Service Contractors
Pacific Egg & Poultry Association
Palm Desert Area Chamber of Commerce
Plumbing-Heating-Cooling Contractors Association of California
San Gabriel Valley Economic Partnership
Santa Maria Valley Chamber of Commerce
South Bay Association of Chambers of Commerce
Southwest California Legislative Council
Torrance Area Chamber of Commerce
Tulare Chamber of Commerce
Valley Industry and Commerce Association
Western Carwash Association
Western Electrical Contractors Association
Western Growers Association
Western Manufactured Housing Communities Association
Western Plant Health Association
Wine Institute
Opposition
CA Conference Board of the Amalgamated Transit Union
CA Conference of Machinists
California Employment Lawyers Association
California Labor Federation, AFL-CIO
California Nurses Association/National Nurses United
California Professional Firefighters
California Rural Legal Assistance Foundation
California Teamsters Public Affairs Council
Consumer Attorneys of California
Engineers & Scientists of CA, Local 20
International Longshore & Warehouse Union
Professional & Technical Engineers, Local 21
SEIU California
UNITE-HERE
Utility Workers Union of America
Analysis Prepared by: Jennifer Richard / L. & E. /
Date of Hearing: May 3, 2017
ASSEMBLY COMMITTEE ON LABOR AND EMPLOYMENT
Tony Thurmond, Chair
ABPCA Bill Id:AB 281 (
Author:Salas) – As Amended Ver:April 26, 2017
SUBJECT: Labor Code Private Attorneys General Act of 2004: right to cure
The bill would extend the period of time in which an employer may cure violations of the Labor Code enforced by the Labor Code Private Attorneys General Act of 2004 (PAGA) from 33 to 65 calendar days.
EXISTING LAW:
- Authorizes, through PAGA, an aggrieved employee who complies with specified notice and filing requirements to bring a civil action to recover specified civil penalties that would otherwise be assessed and collected by the Labor and Workforce Development Agency (LWDA).
- Provides that an employee who prevails in an action under these provisions is entitled to recover his or her filing fees and reasonable attorney’s fees and costs.
- Provides that civil penalties may be assessed against the employer, as provided.
- Provides an employer a right to cure violations under the act before the aggrieved employee may bring a civil action.
- Requires the employer to cure a violation within 33 calendar days of the postmark date of the notice sent by the aggrieved employee or representative.
- The act excludes from the right to cure provisions, various specified violations and other specified health and safety violations.
FISCAL EFFECT: None. This bill is keyed non-fiscal by the Legislative Counsel.
COMMENTS:
General Background on PAGA
PAGA was enacted pursuant to SB 796 (Dunn), Chapter 906, Statutes of 2003, and went into effect on January 1, 2004. SB 796 assigned civil fine amounts to the large number of Labor Code provisions, which previously carried prohibitions or criminal fines, but not civil penalties. It also authorized the filing of civil actions to recover civil penalties by aggrieved workers acting as private attorneys general.
The next year, PAGA was further refined by SB 1809 (Dunn), Chapter 221, Statutes of 2004. SB 1809 significantly revised the provisions of the PAGA by enacting specified procedural and administrative requirements that must be met prior to bringing a private action to recover civil penalties. SB 1809 essentially enacted three different procedural requirements depending on the type of violation; occupational safety and health violations, “serious” Labor Code violations, and a notice and cure provision for the other Labor Code violations not considered serious or related to occupational safety and health.
The provisions of SB 1809 also expanded judicial review of PAGA claims by requiring courts to review and approve any penalties sought as part of a proposed settlement agreement, and those portions of settlements concerning violations of health and safety laws. In addition, courts were authorized to award a lesser amount if to do so otherwise would result in an award that is unjust, arbitrary and oppressive, or confiscatory.
SB 1809 also provided that no action shall be brought for a posting, notice, agency reporting, or filing requirement, except as specified.
Finally, SB 1809 appropriated $150,000 from the General Fund to the LWDA for the purposes of implementing its provisions, and changed the prior penalty formula to provide that 75 percent of most civil penalties recovered pursuant to PAGA shall go to the LWDA for labor law enforcement and education.
Notice and Cure Provisions of PAGA
This legislation amends the procedural requirements for the notice and cure provisions of PAGA that address Labor Code violations not considered serious or related to occupational safety and health.
For these violations, the following procedural requirements apply under current law:
- The aggrieved employee shall give written notice by online filing with the LWDA and by certified mail to the employer of the specific provisions of the Labor Code alleged to have been violated.
- The notice filed with the LWDA and the employer’s response to that notice shall be accompanied by a $75 filing fee.
- The employer may cure the alleged violation within 33 days and give written notice to the employee and the LWDA if the alleged violation is cured.
- If the alleged violation is not cured within the 33-day period, the aggrieved employee may commence a civil action pursuant to PAGA. For the aggrieved employee to dispute that the alleged violation has been cured, the employee must provide written notice to the employer and the LWDA. Within 17 days the LWDA must review the actions of the employer and provide written notice of whether the alleged violation has been cured.
- If the LWDA determines that the alleged violation has not been cured or if the agency fails to provide timely or any notification, the aggrieved employee may proceed with a civil action pursuant to PAGA. If the agency has determined that the alleged violation has been cured, but the employee still disagrees, the employee may appeal that determination to the superior court.
- No employer may use these "notice and cure" provisions more than three times in a 12-month period for the same violation or violations contained in the notice, regardless of the location of the worksite.
This bill extends the time period for curing this type of labor code violations from 33 to 65 calendar days.
Recent PAGA Reform
In 2015, the Governor signed AB 1506 (R. Hernández), Chapter 445, Statutes of 2015, which provides an employer with the right to cure a violation of failing to provide its employees with a wage statement containing the inclusive dates of the pay period and the name and address of the legal entity that is the employer.
Last year, a budget trailer bill, SB 836 (Committee on Budget), Chapter 31, Statutes of 2016, made further revisions to PAGA and increased enforcement funding for the Labor Commissioner. That legislation requires a copy of a proposed settlement to be submitted to LWDA at same that it is submitted to court, and requires parties to provide the LWDA with a copy of the court’s judgement. The bill also extends various time lines, including the time LWDA reviews new cases from 30 to 60 days and the time for LWDA to notify parties of intent to investigate violation from 33 to 65 days. It also provided LWDA with an option to send notice to extend the 120 day time limit for investigating and citing the employer by an additional 60 days and sunsets this 60 day extension on July 1, 2021. The measure also included a $75 filing fee for new case notices and any employer responses to such notices, and required online filing and transmission of all items submitted to the LWDA.
Arguments in Support
The author argues AB 281 seeks to curb abusive PAGA litigation and asserts, “PAGA lawsuits can create hundreds of thousands, if not millions, of dollars in potential liability for employers... If more than one violation occurs, the penalties multiply. On top of these penalties, an employer is liable for a prevailing PAGA employee’s attorneys’ fees and costs as well as its own. Many businesses see no other choice but to pay expensive settlements, file for bankruptcy, lay off workers, or move out of state. “
The California Chamber of Commerce and others argue, “California has some of the most onerous and complex labor laws in the country. This complexity is exemplified by PAGA, which essentially allows an individual to pursue a “representative action” on behalf of similarly aggrieved employees against an employer for almost any Labor Code violation. PAGA requires a $100 penalty per employee, per pay period for the first violation, and $200 per employee, per pay period for each subsequent violation. If there are multiple Labor Code violations, then these penalties are stacked. In addition, if the employee recovers any dollar amount, the employee is entitled to attorney’s fees, which adds another layer of cost onto the employer. “
The Chamber continues, “AB 281 would mitigate this financial threat of frivolous litigation by allowing an employer 65 days in which to cure a limited list of alleged violations before a plaintiff can pursue civil litigation, instead of current law that only provides 33 days. This is beneficial to both the employer and employee. For the employer, it eliminates the threat of costly civil litigation for an unintentional error for which it was not aware. For the employee, it provides an efficient remedy to an alleged violation. Notably, AB 281 only impacts a PAGA claim. For many of the Labor Code violations, there would still be an individual private right of action for an employee to pursue for the alleged violation. AB 281 creates a balance between protecting employees and their rights under the Labor Code while also protecting employers from financially devastating litigation over alleged minor violations.”
Arguments in Opposition
The California Labor Federation writes, “A right to cure typically has the effect of eliminating an employer’s financial incentive to follow the law because in the unlikely event they get caught cheating, he or she would face no penalties. Basically, employers may break the law until caught and only then be required to comply and make workers whole. It eliminates the deterrent to follow the law and in fact may result in significantly more violations of basic workers’ rights.”
The California Labor Federation continues, “AB 281 would almost double employers’ right to cure timeframe, extending it to 65-days. This would only drag out the time period within which an employer must remedy the labor code violations and make the workers whole. A longer cure period would increase the time employers are out of compliance with the law and increase the harm to workers. This is especially true in low-wage and immigrant workforce.”
The California Rural Legal Assistance Foundations (CRLAF), who was one of the original sponsors of the legislation creating PAGA writes, “CRLAF has agreed to a number of amendments to PAGA to address perceived problems with the statute over the past 10 years. Most recently, we worked with the Brown Administration to reform several aspects of PAGA (e.g., mandatory court approval of settlements; extended periods of time for administrative review of potential PAGA claims; and creation of a PAGA unit within the LWDA to scrutinize ‘abusive’ PAGA lawsuits). At no time during those discussions did the issue of a perceived inadequacy of existing cure provisions arise. It is for that reason that we believe AB 281’s changes are unnecessary and unwarranted.”
The California Employment Lawyers Association (CELA) writes, “We are not aware of any evidence to support the need to extend the time frame for these types of PAGA claims. The proposed 65-day cure period would only drag out the time period within which an employer must remedy the labor code violations and make the employees whole. A longer cure period would also delay prosecution of meritorious claims to the great harm of workers. This is especially true in low-wage jobs, where employee turnover is high and witnesses and victims of the alleged Labor Code violations are more transient.”
Previous Legislation
SB 836 (Committee on Budget), Chapter 31, Statutes of 2016. Among other provisions, this budget trailer bill made several changes to PAGA, including an extension of the time period for LWDA to review and investigate PAGA claims. SB 836 also requires a copy of proposed settlement of a PAGA claim to be submitted to LWDA at same that it is submitted to court, and requires parties to provide the LWDA with a copy of the court’s judgement.
AB 1506 (R. Hernández), Chapter 445, Statutes of 2015. Provides an employer with the right to cure a violation of failing to provide its employees with a wage statement containing the inclusive dates of the pay period and the name and address of the legal entity that is the employer.
SB 1255 (Wright), Chapter 843, Statutes of 2012. Provides a statutory definition of what constitutes “suffering injury” for purposes of recovering damages pursuant to the itemized wage statements requirements including failure by the employer to provide a wage statement or failure to provide accurate or complete information regarding the other specified items, as specified.
SB 899 (Poochigian), Statutes of 2004. Exempted workers compensation provisions of the Labor Code from enforcement through PAGA.
SB 1809 (Dunn), Chapter 221, Statutes of 2004. Significantly amended the Labor Code Private Attorney General Act of 2004by enacting specified procedural and administrative requirements that must be met prior to bringing a private action to recover civil penalties for Labor Code violations.
SB 796 (Dunn), Chapter 906, Statutes of 2003. Created an alternative private attorney general system for labor law enforcement in order to augment the enforcement abilities of the Labor Commissioner. Allows employees to sue their employers for civil penalties for employment law violations.
REGISTERED SUPPORT / OPPOSITION:
Support
Almond Alliance of California
American Insurance Association
Associated General Contractors
Association of California Egg Farmers
California Ambulance Association
California Association of Wheat Growers
California Association of Winegrape Growers
California Chamber of Commerce
California Delivery Association
California Farm Bureau Federation
California Framing Contractors Association
California Grain and Feed Association
California Hospital Association
California Hotel and Lodging Association
California Manufacturers and Technology Association
California Pear Growers Association
California Professional Association of Specialty Contractors
California Restaurant Association
California Retailers Association
California Seed Association
California Ski Industry Association
California State Floral Association
California Travel Association
California Trucking Association
California Warehouse Association
Camarillo Chamber of Commerce
Cerritos Regional Chamber of Commerce
Citizens Against Lawsuit Abuse
Civil Justice Association of California
Construction Employers' Association
Culver City Chamber of Commerce
Family Business Association of California
Gateway Chambers Alliance
Greater Bakersfield Chamber of Commerce
League of California Cities
Murrieta Chamber of Commerce
National Federation of Independent Business
North Orange County Chamber of Commerce
Oceanside Chamber of Commerce
Pacific Egg & Poultry Association
Rancho Cordova Chamber of Commerce
Redondo Beach Chamber of Commerce & Visitors Bureau
San Gabriel Valley Economic Partnership
South Bay Association of Chambers of Commerce
Southwest California Legislative Council
Valley Industry and Commerce Association
Western Carwash Association
Western Growers Association
Wine Institute
Opposition
CA Conference Board of the Amalgamated Transit Union
CA Conference of Machinists
California Employment Lawyers Association
California Labor Federation, AFL-CIO
California Professional Firefighters
California Rural Legal Assistance Foundation
California Teamsters Public Affairs Council
Consumer Attorneys of California
Engineers & Scientists of CA, Local 20
International Longshore & Warehouse Union
Professional & Technical Engineers, Local 21
UNITE-HERE
Utility Workers Union of America
Analysis Prepared by: Jennifer Richard / L. & E. /
Bill Author
Bill Co-Author(s):