Western Electrical Contractors Association, Inc.

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Thursday, May 16, 2019


Richard Markuson

PAGA Reform Dead Again

I was just reading a recent appeals court case (Savea v. YRC, Inc., 2019 WL 1552686, Cal. Ct. App. 2019). In this case, Vaiula Savea sued his employer (henceforth referred to as YRC) for an alleged violation of Labor Code § 226. The violation is based upon YRC's alleged failure to include the correct employer name and address on wage statements. These alleged violations arose from YRC's listing its fictitious business name (YRC Freight) on its wage statements.
Furthermore, the complaint alleged that the employer address did not contain a reference to the applicable mail stop code or the ZIP+4 code. YRC successfully demurred to the complaint on the grounds that Savea's complaint failed to state a claim because the employer name and address on its wage statements were, in fact, accurate. The Court of Appeals affirmed dismissal of the complaint, holding that YRC's use of its "actual, recorded fictitious business name" on the wage statements was proper and that the address listed on the wage statements did not need to include the mail stop code or the ZIP+4 code.
After contemplating some special future eternal resting place for the attorney who decided that the lack of a ZIP+4 code was grounds for a lawsuit, I thought I would update readers on how the Legislature is addressing this scourge. Below is the list of accomplishments this year:

  • Pretty impressive, right?

However, here is what they haven't acted upon:
  • AB 443 (Flora R) would limit attorney's fees in connection with an action for a violation of the wage information requirements under PAGA. AB 443 - which did not receive a hearing - would have capped attorney's fees at 25 percent (the pain, the pain!).
  • AB 789 (Flora R) would have required, for an action under PAGA to recover for any violation of the itemized wage statement requirement, that an employee or representative give prescribed notice of the alleged violation to the employer. The bill would have authorized an employer to cure the alleged violation within 65 calendar days of the postmark date of the notice. The bill would have allowed an action to commence only if the alleged violation is not cured within that period. Further, the bill would have exempted certain violations from these notice and cure provisions (if the employer had not paid the aggrieved employee or provided a wage statement).
These modest improvements could not obtain "labor" sign off, so the Democrats refused to hold a hearing.
However, a WECA-supported group is making headway. A judge handed the California Business and Industrial Alliance (CABIA) its first win in March when he denied Attorney General Xavier Becerra's attempt to dismiss CABIA's lawsuit challenging California's PAGA statute. Orange County Superior Court Judge Peter Wilson found that CABIA has standing to bring claims on behalf of its business-owner members challenging the constitutionality of PAGA, a state law that deputizes workers to bring claims against employers believed to be violating state labor laws. Like the one above - citing the lack of a ZIP+4 code. More