🎉 VICTORY ALERT: Newsom signs PAGA reform into law

A long-awaited solution for abusive lawsuits filed under the Private Attorneys General Act (PAGA) is now state law. Governor Gavin Newsom signed two BizFed-supported bills today following relentless and collaborative advocacy from statewide business, labor, and civic leaders. AB 2288 (Kalra) and SB 92 (Umberg) will streamline litigation processes, avert a contentious ballot measure, help employers comply with PAGA, and better support employees with legitimate claims.

We thank our partners at CalChamber for spearheading this effort, all BizFed members who leaned in to amplify our support, and legislators who unanimously passed these bills.

In short, AB 2288 and SB 92 will help employers and employees – which PAGA failed to do. The original act's "lawsuit-first" approach to addressing minor labor law violations and technical errors saddled business owners with unnecessary costs, slowing job growth and forcing some small enterprises to close. Meanwhile, workers received only a small portion of the nearly $10 billion awarded through PAGA lawsuits since 2013. Scroll down for a rundown of what the new, game-changing rules will mean for business.

Click here below to send a "thank you" message to legislators for backing these meaningful reforms.

WHAT THE NEW LEGISLATION DOES

• Expands Labor Code sections that can be cured, reducing the need for expensive litigation.
• Lowers costs for smaller employers by providing a more robust right to cure process through the Labor and Workforce Development Agency (LWDA).
• Codifies the court's authority to limit the scope of claims presented at trial.
• Allows courts to provide injunctive relief, compelling businesses to remedy labor law violations.
• Requires the employee to personally experience the alleged violations brought in a claim.
• Gives the Department of Industrial Relations (DIR) the ability to expedite hiring, ensuring effective enforcement of employee labor claims.
• Encourages compliance with labor laws by capping penalties on employers who quickly take steps to fix policies and practices.
• Creates higher penalties for employers who act maliciously, fraudulently, or oppressively.
• Increases the amount of penalty money allocated to employees for legitimate claims from 25% to 35%.