Seyfarth Shaw LLP | www.seyfarth.com Litigating CA Wage & Hour Class and PAGA Actions (23rd Edition) 99 if there are multiple, recurrent Labor Code violations (or if one act of misconduct violates multiple Labor Code provisions).474 Attorney’s fees to the prevailing plaintiff would augment that total.475 When Arnold Schwarzenegger became governor in 2004, one of his first initiatives was to repeal PAGA. Although his attempt at total repeal was unsuccessful, he and the Legislature did scale back a few of PAGA’s most controversial provisions and inserted some additional procedural protections. SB 1809, signed into law in August 2004, effected the following changes to PAGA: • The bill repealed the requirement (formerly in Labor Code section 431) that employers file a copy of their job application forms with the Division of Labor Standards Enforcement. • Violations of Labor Code provisions that merely require notice, posting, agency reporting, or filing of documents with a state agency are now exempt from prosecution by aggrieved employees. An exception to this exemption was carved out for “mandatory payroll or workplace injury reporting.”476 • All settlements in which penalties are paid must now be judicially approved.477 • The court now may reduce the amount of civil penalties if, under the circumstances, the penalties otherwise would be “unjust, arbitrary and oppressive, or confiscatory.”478 • Before filing suit, a PAGA plaintiff must exhaust an administrative remedies procedure that involves providing written notice of the particular Labor Code violation, containing “the specific provisions of [the Labor Code] alleged to have been violated, including the facts and theories to support the alleged violation,” to the employer and the LWDA for possible investigation.479 474 As the law is not clear on this, employers argue that aggrieved employees are entitled to only one penalty per pay period. Several trial court rulings have held that multiple PAGA penalties may not be “stacked” one upon the other in connection with the same violation. See, e.g., Snow v. United Parcel Services, Inc., No. EDCV 20-025 PSG (AFMx), 2020 WL 1638250, *3 (C.D. Cal April 1, 2020) (“plaintiffs may only recover a set of civil penalties for each type of violation”); Castillo v. ADT, LLC, No. 2:15-383 WBS DB, CV 2:15-383 WBS DB, 2017 WL 363108, at *4 (E.D. Cal. Jan. 25, 2017) (“[PAGA] penalties cannot be ‘stacked’ on top of each other”); Smith v. Lux Retail N. Am., Inc., No. C 13–01579 WHA, 2013 WL 2932243, *3–4 (N.D. Cal. June 13, 2013) (court rejected the notion that Plaintiffs could “pile one [PAGA] penalty on another for a single substantive wrong” as “impermissible”); accord Sanchez v. McDonalds Restaurants of California, Inc., No. BC499888, 2017 WL 4620746 (LA Super. Ct. July 6, 2017) (declining to stack penalties arising out of the same conduct). The legislative history also contains some support for the proposition that duplicative PAGA penalties should not be awarded. See THE LABOR CODE PRIVATE ATTORNEYS GENERAL ACT OF 2004: HEARINGS BEFORE THE ASSEMBLY COMM. ON APPROPRIATIONS, Senate, SB 1809 (July 28, 2004) (statement of Paul Koreiz, Chair, Assembly Committee on Labor and Employment) (describing the “stacking” of PAGA penalties as manifestly unjust, and something that “would demonstrably overbalance and outweigh the [PAGA's] goals of punishment, regulation, and deterrence”) 475 Lab. Code § 2699(g). 476 Lab. Code § 2699(g)(2). 477 Yet, a trial court’s approval of a PAGA settlement is subject to appellate review. For instance, the Court of Appeal has reversed a judgment approving a PAGA settlement when the trial court failed to consider the fairness of the settlement. E.g., Moniz v. Adecco USA, Inc., 72 Cal. App. 5th 56, 88–89 (2021) (reversing judgment; trial court abused its discretion by approving PAGA settlement with “disproportionate allocation of civil penalties” between two groups of employees when its approval order did not “assess[] the allocation and conclude[] it was fair”). 478 Lab. Code § 2699(e)(2). 479 Lab. Code §§ 2699(a), 2699(g)(1), and 2699.3.
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