It’s Lawsuit Abuse Awareness Week, and there’s nothing more vexing to California employers than the Private Attorneys General Act (PAGA), better known as the “Sue Your Boss Law.” PAGA allows employees who believe they’ve been harmed, to file suit against their employer and recover civil penalties for themselves, as well as fellow workers and the State of California.
Like so many pieces of legislation which make their way through the State Capitol, this one started with the best of intentions. However, a law intended to protect vulnerable workers was turned on its head by California’s trial lawyers. The end result? A predatory statute which allows unethical attorneys to extort cash from business owners.
One of the central aims of PAGA is to ensure employees are given breaks when due, and that wages are received in a proper and timely manner. In practice, this is being used against good employers to leverage multi-million dollar settlements for technical infractions of the law. For example, there are rules governing when an employee must receive a meal or rest break based on the number of hours worked. For most persons, it’s not unreasonable to see how a meal or rest period may begin at 10:17 a.m. instead of 10:15 a.m., or that a lunch period scheduled to start at 12:30 p.m. may not see an employee leave his or her desk until 12:33 p.m. as they complete a task. Unfortunately, trial lawyers can be very unreasonable. In California, a 2-3 minute delay in one’s lunch break, could expose a bar or restaurant to $2-$3 million in damages. Worse yet, several employers have faced lawsuits for allowing staff to adjust their meal and break schedules to care for family members – but the trial lawyers don’t stop there.
In addition to meal and rest breaks, employers have also been sued over the details of their paystubs. California law requires certain information to be included with each paycheck, and if a single detail is excluded, the exposure can total several million dollars. Under PAGA, employers have been sued for utilizing a corporate logo on their check, rather than typing out the name. That’s right, place an “ACME Corp” logo on the check instead of typing ACME Corp in a proper font, and it could cost several thousand dollars per employee. Also, if your full legal name is ACME Corporation but only Corp is listed, that’s another potential violation of the law.
Want more? Leave off the address of the bank branch and find yourself sued for another violation. If that’s not enough, employers have also been sued for mistakes like listing “Suite 120” instead of “Suite 110” in the address line, because without that, the employee may not know how to find their place of work. The absolute worst outcome of PAGA? Employers being unable to pay Christmas-time bonuses, after many were sued for not properly calculating it as overtime pay. Imagine that, the Grinch does exist – and he’s a trial lawyer!
It’s time to put a halt to this madness. PAGA is significant reason why California businesses, and the jobs they represent, are fleeing to other states. These heinous lawsuits are not victimless events, because job loss hurt entire communities, and the only beneficiaries are trial lawyers and their wallets.