An initiative aimed at repealing a landmark California law that gave workers the right to sue their employers for themselves and other employees will remain off the November ballot after an agreement reached by labor and business groups with the governor. Gavin Newsom.
The agreement aims, among other things, to reform the two-decade-old Private Attorneys General Act (PAGA) by limiting penalties for employers who act quickly to change practices, increasing the penalty share of employee payments, allowing courts to order to force companies to resolve labor violations and require workers to experience firsthand the alleged violations they cite in a claim, the governor’s office said Tuesday in a news release announcing the agreement.
“We came to the table and made a deal that works for both businesses and workers and will deliver needed improvements to this system,” Newsom said in a statement. “This proposal maintains strong protections for workers, encourages companies to comply with labor laws and reduces the number of lawsuits.”
The agreement to reform PAGA “avoids a controversial election campaign,” the government press release said.
The deal was praised by unions and business leaders.
“We are pleased to have reached a deal that preserves and improves PAGA, adding interim measures to end abusive practices and incentivize employers to comply with the rules and keep workers healthy,” said Lorena Gonzalez, chief executive officer of the California Labor Federation. AFL CIO. “PAGA is an essential tool for holding companies accountable for widespread wage theft, safety violations and misclassification.”
Jennifer Barrera, president and CEO of the California Chamber of Commerce, urged swift approval of the deal by the Legislature.
“This package provides meaningful reforms that ensure workers continue to have a strong tool to resolve employment claims, while also limiting frivolous lawsuits that have cost employers billions without benefiting workers,” Barrera said.
A coalition of labor organizations, worker advocates and advocacy groups said in a news release that “the agreement protects workers’ right to hold abusive employers accountable through PAGA, and encourages employers to treat their employees with the dignity and respect that they earn, while the penalties are increased. for the most abusive employers.”
“While we successfully negotiated a dangerous measure out of the November ballot, we can only hope that this deal encourages more employers to follow the law and pay their employees what they are owed,” said Kathryn Stebner, president of Consumer Attorneys of California.
Assembly Speaker Robert Rivas, D-Salinas, said the “hard-earned agreement” both protects workers and recognizes companies that follow labor laws while strengthening enforcement.
“I grew up watching farm workers and employers find common ground, so it means a lot to me that so many groups came together and reached consensus,” he said.
The November ballot initiative would have repealed PAGA, which allowed “employees to bring lawsuits against employers on behalf of themselves and other employees to collect monetary penalties for certain labor law violations,” according to the Secretary of State’s website.
A summary by the Legislative Analyst’s Office and the Treasury Department of the initiative’s fiscal impact on state and local governments noted that the measure would likely increase the state’s costs for enforcing labor laws by more than $100 million per year. And it would reduce state revenue from fines used to enforce labor laws by tens of millions of dollars annually.
Once the Legislature passes the bill reflecting the deal and Newsom signs it, proponents of the business-backed initiative will withdraw the ballot measure. The bill would have to be signed by the governor before June 27, the deadline for the secretary of state to certify ballot measures for the November general election.
