California’s PAGA Reform Emphasizes Importance of Proactive Labor Violation Cure by Employers
The California Private Attorneys General Act (PAGA) is a state law that allows workers to sue employers directly for Labor Code violations, on behalf of themselves and other “aggrieved employees.” Businesses and organizations have struggled to navigate this law because relatively minor violations can result in serious liability and penalties. On July 1, 2024, Governor Gavin Newsom signed two bills into law bringing about a set of PAGA reforms. Here, our California employment lawyer discusses the reforms and explains why it is so important for employers to cure Labor Code violations promptly and proactively.
California Reformed PAGA (Less Punitive for Employers)
Following a number of different complaints from employers, California legislators reformed PAGA and enacted a number of major changes. Notably, these reforms help to make the law less punitive for employers. California’s new PAGA law caps and reduces penalties for Labor Code violations—especially for employers who proactively comply or correct issues upon receiving a notice. Further, the reforms make litigation more efficient by limiting the scope of workers’ claims and enhancing an employer’s right to cure violations.
New Reforms Make Proactive Labor Code Violation Cures Essential
As California’s PAGA reform takes effect, it is especially important for employers to take a proactive approach to identify, address, and cure potential Labor Code violations. Here are four important action steps for employers in California:
- Proactively Assess Wage and Hour Compliance: Employers in California should review and audit their wage and hour practices regularly. An audit of practices and prompt corrections ensure that the employers align fully with current labor laws—including minimum wage requirements, overtime pay rules, and exempt classifications. A routine compliance check can help identify discrepancies early before they evolve into bigger problems. A California workplace solution lawyer for employers can help ensure the company is implementing legally-complaint practices.
- Regularly Audit Payroll and Timekeeping Practices: Employers should implement regular audits of their payroll and timekeeping systems to ensure employees’ pay is accurate. Automated systems can help speed up these audits—but manual checks are also necessary to catch any discrepancies which employers should remedy immediately. These audits not only help maintain compliance but are also evidence of the employer’s good faith in litigation or other proceedings, if any employee files a PAGA claim.
- Provide Ongoing Training to Managers: Managers play a key role to help employers comply with labor laws. Therefore, providing these managers with ongoing training on the latest regulations and company policies is essential. The training should generally cover how to document overtime, manage meal and rest breaks, and handle employee grievances properly.
- Address Potential Violations Voluntarily: If an employee or company audit identifies a potential Labor Code violation, employers should take immediate steps to rectify the issue. Employers should contact their attorney if they find a violation, to ensure that they take the necessary steps to make the employee whole and prevent future violations. By correcting a violation voluntarily—ideally before any worker sends a formal notice —an employer can mitigate their legal liability.
Speak to an Employment Law Attorney in California
At Sloat Law Group, APC, our California employment lawyers are standing by, ready to protect your rights and your interests. If you have any questions about proactively preventing and curing Labor Code violations, please do not hesitate to contact our employment firm for help. With an office in Riverside County, we represent employers throughout all of California.
Source:
dir.ca.gov/Private-Attorneys-General-Act/Private-Attorneys-General-Act.html
