SACRAMENTO – A round of fixes to a hastily drafted consumer protection bill that became law last year can’t come soon enough, according to Ken Barnes, the executive director of California Citizens Against Lawsuit Abuse (CCALA).
Under the California Citizens’ Privacy Act, job applicants would have been afforded the same consumer protections a business is obligated to provide its customers. A law closing this loophole, AB 25, passed the California Assembly on June 29.
“It has some opposition from the trial lawyers’ group, which tells us everything we need to know,” Barnes said. The loophole had “nothing to do with consumer privacy” and its purpose was intended to encourage “bringing litigation in new areas.”
Another consequence of last year’s CCPA would have penalized businesses for sharing mandatory information with the federal government. Barnes said Rep. Ken Cooley (D-District 8) sponsored AB 1416 to end this loophole, but the bill is still in committee and has not made its way to a vote yet.
“We’re hoping that that one is going to pass through,” Barnes said. “Everyone generally tends to be on board with businesses being able to stay in compliance with the law without risking noncompliance with another law.”
Sometimes legislation that appears consumer-friendly may cause negative consequences for business. An example Barnes cited is AB 1286, which would require businesses that rent bikes and scooters for urban use to carry high amounts of liability insurance.
Barnes said the high insurance premiums would either cause such businesses to cease operations or cause a massive price hike.
“If you ride over a railroad track and fall and scuff your knee, it’s just a fact of life,” Barnes said. “But if there’s a handlebar recall and the company doesn’t take steps to fix it, then they should still be responsible” for injuries.
By far the law drawing the most opposition from CCALA is the Private Attorney General Act, which penalizes businesses for failing to give hourly employees breaks on time.
As Barnes explained, this law would assess a fine of $100 per week for any mistake in employees’ break times. For instance, if a worker wasn’t allowed to take a break at the legally mandated time, the business could be fined $5,200 for that calendar year. On top of that, the penalties are cumulative, so fines for incorrect pay stubs could increase the amount dramatically.
“It’s an enterprise killer,” Barnes said of PAGA. “Without a doubt, it’s the fastest-growing body of litigation year over year. It’s taking out businesses large and small across the state.”