On June 29th, the California Supreme Court gave employees an alternative route to challenging their employer’s violations of the Labor Code. For employees seeking civil penalties from their employers under the Labor Code Private Attorney General Act of 2004 (PAGA), there is no longer a need to obtain class certification. Class certification is needed when there is a large group of employees suing their employer for similar Labor Code violations in a lawsuit called a “class action.” Class certification had been a significant obstacle for plaintiffs in many lawsuits filed against employers. In an area of law where traditionally employers have the upper hand, this ruling is extremely helpful to employees seeking to recover lost wages and penalties from their employer. Examples of a few Labor Code violations include: unpaid overtime, withholding of meal and rest breaks, and failure to pay final paychecks in a timely manner after employee termination.
The Supreme Court simultaneously ruled, however, that employees attempting to bring Unfair Competition Lawsuits, another common claim against employers, must obtain class certification. This ruling is more advantageous to employers because the ruling allows employers to dismiss a lawsuit based on the lack of class action qualification.
In sum, employees were dealt a significant advantage against employers for Labor Code violations. Averting the class certification process may prevent an employee’s lawsuit from being dismissed. In our opinion, this ruling is a major victory for the employees we represent.