©2025 Seyfarth Shaw LLP www.seyfarth.com 2025 Cal-Peculiarities | 125 5.15.3 Other preceding PAGA amendments Earlier reform legislation mitigated certain other aspects of PAGA. The principal reform measures after PAGA’s initial enactment were as follows. DLSE exhaustion requirement. Following the 2004 amendment, employees challenging certain Labor Code violations must, before suing, give written notice to the LWDA of the specific violation, to enable the LWDA to investigate and cite the employer for the violation, in which case a private lawsuit cannot proceed.439 The LWDA has 60 days to notify the employee that it intends to investigate the alleged violation, in which case a private lawsuit cannot proceed.440 If the LWDA gives notice that it does not intend to investigate or the LWDA does not act with 65 days, then the employee may file a PAGA action.441 A PAGA claim is deficient if the notice to the LWDA and the employer failed to provide sufficient “facts and theories” for the alleged Labor Code violation.442 The Court of Appeal thus held that a PAGA plaintiff who complains of untimely payment of termination wages on behalf of all aggrieved employees cannot proceed if the LWDA notice refers only to the plaintiff’s own situation.443 A 2020 Court of Appeal decision, however, reasoned that the “facts and theories” alleged in an LWDA letter “need not ‘satisfy a particular threshold of weightiness,’” and held that a PAGA plaintiff had adequately exhausted administrative remedies by alleging in his LWDA letter that the employer had knowingly permitted employees to work off the clock, had unlawfully rounded work time, had automatically deducted 30 minutes of pay for meal periods not taken, and had manipulated time to avoid overtime wages.444 Courts have further diminished the significance of PAGA exhaustion requirements by holding that plaintiffs may pursue certain penalties without first contacting the DLSE. These are “statutory penalties” — those that employees could collect directly, pre-PAGA (e.g., waiting-time penalties). These courts would apply the exhaustion requirement only as to “civil penalties,” defined as those penalties that only the Labor Commissioner can collect absent a PAGA action. Courts thus have held that while employees must exhaust LWDA remedies as to any claim for “civil penalties,” employees need not contact the LWDA before suing for “statutory penalties.”445 Of some concern with respect to the exhaustion requirement was a 2008 Court of Appeal decision holding that PAGA claims added in an amended complaint relate back to the original complaint, if the claims rest on the same misconduct and the same injury.446 But this decision failed to address the exhaustion requirement, and courts since have recognized that the failure to properly notify the LWDA and the employer is fatal to a PAGA claim.447 Curing violations. Under pre-reform PAGA, for a few specified violations, the employer had the opportunity to cure the violation within 33 days of the employee’s notice.448 A 2015 amendment allowed employers to cure any wage statement violations pertaining to the requirements for providing “the inclusive dates of the period for which the employee is paid” and “the name and address of the legal entity” that is the employer.449 If the employer does not cure and the LWDA does not pursue the matter itself, then the employee may sue.450 If the LWDA cites the employer for a violation, then a private action by an “aggrieved employee” cannot be brought based on the same violation.451 Under the 2024 PAGA reform, employers are now permitted to cure any wage statement violations under Labor Code section 226, as well as violations of section 226.7 (failure to pay meal/rest period premiums), section 510 (overtime), and section 2802 (expense reimbursement).452 Judicial discretion to reduce penalties. PAGA expressly grants courts discretion to reduce the amount of PAGA penalties if the amount otherwise would be “unjust, arbitrary and oppressive, or confiscatory.”453 In exercising that discretion, courts have considered such factors as the corresponding amount of statutory
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