As the coronavirus threat has led to a wave of business closures across California, a trade organization is calling on the governor to put a halt to PAGA (Private Attorneys General Act) lawsuits.
Close to 300 PAGA claims have been filed in the last two weeks, Tom Manzo, founder and president of the California Business and Industrial Alliance (CABIA) told the Northern California Record.
“In the state of California, 1.6 million people have filed for unemployment, 30 percent of the restaurants might never reopen; the last thing people need to look at right now is one of these frivolous lawsuits that take up valuable time and money,” Manzo said.
The March 25 letter from CABIA to Gov. Gavin Newsom asks for a 90-day moratorium on PAGA litigation.
“These claims, while lucrative for trial lawyers, often cost businesses thousands if not millions of dollars in settlement and legal fees for even a minor infraction of California’s labor code. Aggrieved employees typically recoup far less,” the letter states.
The original PAGA law, signed by then outgoing Gov. Gray Davis in 2003, has allowed trial lawyers to sue employers on behalf of workers for alleged infractions of California labor laws.
“The governor could issue this, he has the authority to do this, it’s an avenue he could consider,” Manzo said.
“Worst case scenario, do the moratorium, then sit down collectively, bring labor to the table, bring anybody you want, and then let’s make some changes to this law that work for everybody, not just the trial attorneys,” Manzo said.
The letter states that at least seven health care facilities have received PAGA notices in recent weeks.
“Hospitals, medical centers, the trial attorneys don’t care, they are looking for quick payday and at this particular time, we need to take a step back, it shouldn’t be allowed,” Manzo said.
“Why not just relax this particular law for 90 days or 120 until we see where we’re at with this virus,” he added.