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On July 17, 2023, the California Supreme Court decided an important state law issue raised by the United States Supreme Court’s decision in Viking River Cruises, Inc. v. Moriana, 142 S. Ct. 1906 (2022). Viking River Cruises held that the Federal Arbitration Act (FAA) requires enforcement of an agreement to arbitrate California Private Attorneys General Act (PAGA) claims arising from alleged California Labor Code violations against the named plaintiff, notwithstanding the prior California authority that PAGA claims cannot be “split” into “representative” and “individual” components. In a short paragraph at the end of its decision in Viking River Cruises, the U.S. Supreme Court held that a PAGA plaintiff lacks statutory standing to pursue PAGA claims arising out of alleged Labor Code violations committed against other employees when the claims arising from violations against the named plaintiff have been “pared away” to arbitration. However, because statutory standing is an issue of state law, state courts were not bound by the U.S. Supreme Court’s interpretation, a point that Justice Sotomayor flagged in a concurrence. In Adolph v. Uber Techs., Inc., No. S274671, 2023 WL 4553702 (2023), the California Supreme Court disagreed with the U.S. Supreme Court’s interpretation of PAGA’s standing requirement and held that a PAGA plaintiff retains standing to sue for alleged Labor Code violations committed against non-party employees when the claims arising from alleged violations against the plaintiff have been compelled to arbitration.…

Continue Reading California Supreme Court Clarifies PAGA Standing When “Individual PAGA Claims” Have Been Compelled to Arbitration

On July 11, 2023, the California Court of Appeal in Thai v. IBM held that whether an employer is obligated to reimburse expenses incurred by an employee working from home turns on whether the expenses were a direct consequence of the discharge of the employee’s job duties, not on whether the expenses were directly caused by the employer. This case is important for all employers whose workforce suddenly began working from home as a result of the COVID-19 pandemic, and employers who continue to permit employees to work from home today.…

Continue Reading California Court of Appeal Clarifies Employer’s Obligation to Reimburse Expenses Depends on Whether They Were a Direct Consequence of Job Duties, Not Proximately Caused by Employer

California’s Private Attorneys General Act of 2004 (“PAGA”) allows employees to act as an “agent” of the State of California and recover civil penalties for violations of the Labor Code through a civil action filed on behalf of themselves and other current or former employees. In Viking River Cruises, Inc. v. Moriana, the U.S. Supreme Court held that the Federal Arbitration Act partially preempted a California rule prohibiting employers from requiring their employees to enter into pre-dispute arbitration agreements that contractually waived the right to assert “representative” claims under PAGA. Viking River held that while California could validly prohibit pre-dispute arbitration agreements effecting “wholesale waivers” of PAGA claims, the Federal Arbitration Act preempts any rule against requiring employees to arbitrate their “individual” PAGA claims.…

Continue Reading Fording Viking River, Another California Court of Appeal Holds That PAGA Plaintiffs Maintain Standing to Pursue “Representative” Claims Even if Compelled to Arbitrate “Individual” Claims

On February 2, 2023, the California Court of Appeal issued an important follow-up decision to the United States Supreme Court’s decision in Viking River Cruises, Inc. v. Moriana, — U.S. —, 142 S. Ct. 1906 (2022). Galarsa v. Dolgen California, LLC, — Cal. Rptr. 3d — , 2023 WL 2212196 (2023),addresses whether a plaintiff alleging claims under the California Private Attorneys General Act of 2004 (PAGA) retains standing to assert claims premised on California Labor Code violations suffered by other employees when the claims arising from alleged violations suffered by the plaintiff are compelled to arbitration. The Court of Appeal ordered Galarsa published on February 24, 2023, making the decision binding on state trial courts for the time being.…

Continue Reading California Court of Appeal Holds That a PAGA Plaintiff Maintains Standing to Assert Representative Claims Even When Individual Claims Are Compelled to Arbitration

The California Court of Appeal in Meda v. AutoZone, Inc. recently reversed a trial court’s finding that an employer demonstrated it “provided” seats to its employees as a matter of law under California’s suitable seating requirement. This rule stems from subdivision 14(A) of the Wage Orders,[1] which provides that California employers must provide suitable seats to employees “when the nature of the work reasonably permits the use of seats.” In Kilby v. CVS Pharmacy, Inc., 63 Cal. 4th 1 (2016), the California Supreme Court set forth the fact-intensive framework and multiple factors in analyzing whether the “nature of the work reasonably permits the use of seat,” triggering the employer’s obligation to provide suitable seats. However, no published California authority had considered what steps employers must take to “provide” seats under subdivision 14(A).[2]…

Continue Reading Are You Sitting Down for This? California Court of Appeal Provides Further Guidance on Suitable Seating Claims

On March 23, 2022, the California Court of Appeal for the Fourth District in Estrada v. Royalty Carpet Mills, Inc., ruled that courts do not have authority to strike a claim under the Private Attorneys General Act (“PAGA”) due to a lack of manageability at trial. Estrada creates a split of authority with a pro-employer decision, Wesson v. Staples the Office Superstore, LLC, 68 Cal. App. 5th 746 (2021). The Court in Wesson found that trial courts have inherent authority to dismiss PAGA claims as unmanageable. Wesson was discussed in detail in a prior blog article.
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Continue Reading Split of Authority Emerges Regarding Whether Employers Can Dismiss PAGA Lawsuits on Manageability Grounds

On February 7, 2022 a California Court of Appeal issued its decision in Hutcheson v. The Superior Court of Alameda County (UBS Financial Services, Inc.).  The case addresses the relation back doctrine in the context of a Private Attorneys General Act of 2004 (the “PAGA”) lawsuit, and will have important consequences for PAGA cases moving forward.
Continue Reading Employers May Face an Expanded Liability Period in PAGA Suits Under the Relation Back Doctrine

On February 18, 2022, the California Court of Appeal issued its decision in Jill LaFace v. Ralphs Grocery Company, __ Cal. App. 5th __ (2022), that provides important guidance in two areas. First, the Court made clear that plaintiffs asserting a claim under the Private Attorneys General Act (PAGA) are not entitled to a jury trial. In addition, the Court affirmed the lower court’s ruling rejecting the plaintiff’s suitable seating claim and found that an employee cannot create a “lull in operation” to trigger the provision of a seat by remaining idle instead of performing other expected job duties.
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Continue Reading California Court of Appeal Makes Clear that PAGA Plaintiffs are not Entitled to a Jury Trial and Provides Helpful Guidance on Suitable Seating Claims

On December 15, 2021, the United States Supreme Court granted certiorari in Viking River Cruises, Inc. v. Moriana, a case which asks whether the Federal Arbitration Act (“FAA”) requires the enforcement of bilateral arbitration agreements providing that an employee cannot raise representative claims, including under the California Private Attorneys General Act (“PAGA”).
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Continue Reading Supreme Court Grants Review in Important Arbitration Case Regarding PAGA

On November 30, 2021, the Court of Appeal, First Appellate District, issued an important opinion in Moniz v. Adecco USA, Inc., __ Cal. App. 5th __ (2021), which will impact employers facing PAGA lawsuits.  Moniz clarified several critical issues employers routinely face in PAGA litigation.  First, departing from Turrieta v. Lyft, Inc., 69 Cal. App. 5th 955 (2021), Moniz held that a deputized aggrieved employee challenging a PAGA settlement has appellate standing to challenge another PAGA settlement that would wipe out their ability to pursue a PAGA claim.  This may affect all employers facing more than one PAGA lawsuit at a time.  Second, Moniz held that claims are validly released if they relate to the same primary right as the claims listed in the PAGA letter that the aggrieved employee sends to the California Labor and Workforce Development Agency (the “LWDA”).  Finally, Moniz provided guidelines to assess whether a trial court should approve a PAGA settlement.
Continue Reading California Court of Appeal Provides Guidance, and Creates a Split, on Critical PAGA Issues