by Michael Kun
As we have mentioned previously on thisblog, the latest wave of wage-hour class actions to hit California employers is based on a claim that employees were not provided "suitable seating" under an obscure provision of California’s Wage Orders. To avoid having these cases removed to federal court,and to avoid the burden of establishing the elements for class certification, many plaintiffs’ counsel have taken to filing these lawsuits not as class actions, but as representative actions under California’s Private Attorneys General Act ("PAGA").
PAGA — sometimes referred to as the "Bounty Hunter Law" or the "Sue Your Boss Law" — allows a single employee to pursue claims on behalf of all "aggrieved employees," with potential recovery of up to $100 per employee for the first violation and $200 per employee for each subsequent violation. The potential recovery can be enormous, and a plaintiff need not certify a class.
The constitutionality of PAGA has long been a matter of concern and dispute. We and other defense counsel often raise constitutionality defenses to PAGA claims and raise those arguments at various stages of the cases. Unfortunately, judges rarely take interest.
Los Angeles Superior Court Judge Daniel Buckley apparently has seized on this issue and has articulated his intention to dismiss a PAGA seating case against Whole Foods Market on the grounds that PAGA is unconstitutional. He appears to be one of the first judges, if not the first, to make such a ruling about PAGA.
Assuming that Judge Buckley issues that ruling, it is all but certain that plaintiff’s counsel will appeal. The case will bear watching because a ruling by the Court of Appeal or, eventually, the California Supreme Court striking down PAGA on constitutionality grounds could shut down all claims under PAGA. While that would not spell the end of wage-hour class actions, it would close off one of the avenues often relied upon by plaitniffs’ counsel to increase the potential exposure in a case for settlement purposes. And it may force plaitniffs to bring wage-hour claims as potential class actions, which would not only increase the likelihood of removal to federal court, but require plaintiffs to carry a significant burden in convincing a court to certify a class.