PAGA: Plaintiffs Compelled to Arbitrate Individual Claims Maintain Standing for Representative Claims

July 27, 2023 | From HRCalifornia Extra

by Bianca N. Saad, Vice President of Labor and Employment for Content, Training and Advice, CalChamber

The Private Attorneys General Act of 2004 (PAGA) authorizes an “an aggrieved employee” to bring a civil action against an employer on behalf of themselves and other current or former employees, acting as a proxy or agent of the state Labor and Workforce Development Agency. Under the PAGA, such an employee can bring a civil action against an employer on behalf of themselves (an individual claim) and other current or former employees (a representative or non-individual claim) to recover civil penalties for Labor Code violations they have sustained.

The interplay between PAGA claims and arbitration — whether they can be compelled to arbitration if an employee signs a valid arbitration agreement — has been the source of ongoing litigation over the years. And the most recent development on this front occurred on July 17, 2023, when the California Supreme Court issued a significant ruling that will allow an employee to pursue representative PAGA claims in civil court even after their individual PAGA claims are compelled to arbitration (Adolph v. Uber Technologies, Inc., No. S274671 (July 17, 2023)).

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