Employers were dealt another blow in a recent decision by the Court on PAGA Claims this week. The Courts of Appeal have in the past two years reached contrary conclusions as to whether trial courts have the inherent authority to strike a Labor Code Private Attorneys General Act of 2004 (PAGA; Lab. Code, § 2698 et seq.) claim on manageability grounds. (Compare Estrada v. Royalty Carpet Mills, Inc. (2022) 76 Cal.App.5th 685, 697 (Estrada) [concluding that trial courts lack such inherent authority] with Wesson v. Staples the Office Superstore, LLC (2021) 68 Cal.App.5th 746, 766–767 (Wesson) [concluding that trial courts possess such inherent authority]; see also Woodworth v. Loma Linda University Medical Center (2023) 93 Cal.App.5th 1038, 1047, review granted Nov. 1, 2023, S281717 (Woodworth) [agreeing with Estrada that “trial courts may not strike or dismiss a PAGA claim for lack of manageability”].) The Court granted review in Estrada v. Royalty Carpet Mills, Inc. (SC S2743401/18/24) PAGA Manageability to consider the issue.
The Court held: We now conclude that trial courts lack inherent authority to strike PAGA claims on manageability grounds. In reaching this conclusion, we emphasize that trial courts do not generally possess a broad inherent authority to dismiss claims. Nor is it appropriate for trial courts to strike PAGA claims by employing class action manageability requirements. And, while trial courts may use a vast variety of tools to efficiently manage PAGA claims, given the structure and purpose of PAGA, striking such claims due to manageability concerns — even if those claims are complex or time-intensive — is not among the tools trial courts possess. Accordingly, we affirm the Court of Appeal’s judgment as that court reached the same conclusion we reach here. (See Estrada, supra, 76 Cal.App.5th at p. 697.)
This decision makes it even harder for employers to economically defend and dismiss PAGA claims, requiring lengthy analysis, motion work and trial in order to prevail on even frivolous claims. It is important that Employers ensure not only that they have lawful written policies (as most do) but also that they have well trained managers following the rules and the laws to avoid such PAGA claims.
--
If you need assistance with PAGA claims or other employment law matters, please reach out to Department Chair, Christine H. Long, at 408.286.5800 or christine.long@berliner.com.