California’s Supreme Court ruled that an employee cannot collect unpaid wages through claims that cite the 2004 Private Attorneys General Act (PAGA). PAGA allowed employees to sidestep employment agreements that required arbitration with an employer to settle wage disputes. Employees collected unpaid wages by citing PAGA in claiming their wages were civil penalties as defined in the law.
A pro-employee interpretation
PAGA sets up statutes that an employee can use to file a whistle-blower claim in response to an employer who:
- Fails to pay minimum wages.
- Fails to pay overtime or other compensations.
- Incurs safety violations.
If the state doesn’t take on the claim, the employee could then act on the state’s behalf to file suit for all affected employees. According to worker advocacy groups, the act was used to collect on wage violations which brought the state $88 million from employers and produced better adherence to workplace laws.
Consequences for employees
The California Supreme Court showed that PAGA statutes don’t qualify for an employee’s unpaid wages since the act only refers to civil penalties. This means employees who are owed wages have fewer options for receiving compensation from employers. This ruling is surprising for a state like California, which is typically pro-employee. If your employer owes you wages, contact a lawyer experienced in employment law. Your hard work deserves pay. An attorney can help you receive this necessary compensation.