Title: California Lawmakers Pass Reforms to PAGA, Ending Ballot Initiative
Introduction:
In a significant turn of events, California lawmakers have passed a package of bills to reform the Private Attorney General Act (PAGA) just hours before a worker-protection initiative could be placed on the November ballot. The reforms aim to address the concerns raised by businesses about increased nuisance lawsuits while protecting workers’ rights. This article explores the details of the reforms, the widespread support they received, and the potential impact on businesses and employees.
Strengthening Oversight and Reducing Litigation Costs:
The newly enacted bills, Senate Bill 92 (SB 92) and Assembly Bill 2288 (AB 2288), aim to strengthen oversight powers of the Labor and Workforce Development Agency while reducing litigation costs. SB 92 expedites proceedings by allowing employers to cure alleged violations within 33 days of a complaint. Employers with fewer than 100 workers can also submit confidential proposals for the agency’s verification. AB 2288 reduces penalties for less serious labor law violations, increases penalties for egregious violations, and gives courts more discretion in adjusting penalties to protect businesses and employees.
Bipartisan Support and Widespread Endorsement:
The reforms received bipartisan support, with both the Assembly and the Senate voting in favor of the bills. Notably, no opposition letters were filed, and 91 organizations, including the California Chamber of Commerce and the California Labor Federation, expressed support for the bills. This broad support highlights the urgent need for change due to lengthy court proceedings and high litigation costs that have burdened businesses statewide.
Addressing Concerns and Preventing Nuisance Lawsuits:
Small businesses have long been targeted by frivolous PAGA lawsuits, leading to closures in some cases. Jot Condie, president and CEO of the California Restaurant Association, emphasized that the reforms will help prevent nuisance lawsuits and protect small businesses. Similarly, Barry Jardini, executive director of the California Disability Services Association, highlighted how the new laws will allow employers to focus on serving their clients instead of defending themselves in court. Dave Puglia, president and CEO of the Western Growers Association, thanked lawmakers for passing the reforms, as PAGA’s abusive litigation has contributed to the loss of small family farms.
Insights from Reports and Research:
A report by the consulting firm Baker & Welsh revealed that businesses have paid nearly $10 billion in awards since 2013, emphasizing the financial burden caused by PAGA lawsuits. Additionally, researchers from the University of California-Los Angeles Labor Center found that 600,000 workers experience wage violations in California, resulting in annual losses of $2 billion. These findings underscore the need for reforms to strike a balance between protecting workers’ rights and preventing excessive costs for businesses.
Conclusion:
The recent passage of reform bills by California lawmakers has effectively ended a worker-protection initiative seeking to reform PAGA. The bipartisan support and widespread endorsement of the reforms demonstrate the collective recognition of the need for change. By strengthening oversight, reducing penalties for minor violations, and protecting businesses from unjust action, these reforms aim to strike a balance between workers’ rights and the concerns of employers. As Governor Gavin Newsom is expected to sign the bills soon, businesses can anticipate immediate changes in the way PAGA operates, potentially alleviating some of the burdens they have faced in recent years.
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