As businesses strive toward economic recovery in 2021, new research shows California is the state with the most COVID-related workplace class action lawsuits, a trend likely to continue absent some form of state or federal liability protection.
“Business owners want and need a system, especially here in California, that does not become a magnet for litigation,” Maryann Marino, Southern California regional director of California Citizens Against Lawsuit Abuse (CALA), told the Northern California Record by email.
“Especially now, as business owners are working hard to comply with the many regulations and changing safety protocols being put in place by the state and county agencies.”
A recent Seyfarth analysis found California had the highest number of COVID-related class-action claims of any state in the nation.
“California is well known for its plaintiff-friendly court system which puts California businesses at greater risk of lawsuits,” Marino said. “Plus, California is the only state in the country that allows for Private Attorney General Act (PAGA) lawsuits that allow private attorneys to sue on behalf of the state and seek penalties against employers for several different labor violations, based on technical deficiencies. PAGA lawsuits have become a windfall for attorneys and offers little in compensation for employees.”
As 2021 unfolds, employers need to make sure they’re staying up to date with evolving workplace mandates, Marino said.
“All business owners operating in a COVID-19 environment need to be out in front on compliance,” Marino said. “They also need to band together and be a stronger voice at the Capitol, sharing with their legislators the need for COVID-19 liability protections.”
It’s not clear if California plans to pass a liability shield, as 30 other states have, but state lawmakers may take up the issue.
“We hope so, especially if a business was complying with all the reasonable protocols put in place by the state or county agencies,” Marino said. “Otherwise, a lawsuit filed against an already struggling business would likely be the death knell for that business and its employees.”
Litigation relief could be addressed through legislation or changes to enforcement.
“One way to do that would be to relieve employers of the abusive PAGA lawsuits,” Marino said.
“When COVID-19 hit, businesses had to quickly respond to the orders put in place by the state and county agencies, some businesses closed down, others redirected their employees to work from home, and others had to adjust to the new way of working. Employers worked hard to make that happen and to protect and keep their employees employed.”
A number of high-profile corporations have recently decided to move out of California.
“Many companies have left and continue to leave the leave the state,” Marino said. “Once again California needs to do all it can to protect our businesses and jobs they create.”