Hunton Employment & Labor Perspectives

Claims under California’s Private Attorneys General Act (PAGA) are recently much in vogue.  With the proliferation of arbitration agreements and class action waivers, plaintiffs’ attorneys all over California been using PAGA claims – which cannot be waived in an arbitration agreement – as a preferred vehicle to pursue representative wage-and-hour lawsuits against employers.

While there are many unresolved issues relating to the litigation of PAGA lawsuits, California courts are making clear that a PAGA lawsuit will fail if the plaintiff does not send a compliant pre-filing notice to the Labor and Workforce Development Agency (LWDA) prior to the elapse of the statute’s 1-year limitations period.

The California Court of Appeal’s recent decision in Esparza v. Safeway, Inc. (filed June 10, 2019) provides another example of this growing consensus.  In Esparza, the employee filed a PAGA claim in connection with her employer’s meal and rest period practice.  The Esparza court affirmed the trial court’s ruling striking the PAGA claim, because the LWDA notice was sent more than 1 year after the last alleged violation.   The employer’s allegedly unlawful practice had ended on June 17, 2007, and hence the one-year statute of limitations for the PAGA claim lapsed on June 17, 2008.  Thus, the LWDA notice – sent on July 7, 2008 – was 20 days too late.   The court rejected the argument that the PAGA claim related back to the date the original complaint was filed in April 2007.  In doing so, the court held that the LWDA must be notified of the forthcoming PAGA suit during the one-year limitations period so that the agency can first decide whether it will act on the violations alleged in the notice.  In reaching this conclusion, Esparza joined a slate of recent California appellate decision that have likewise strictly construed PAGA’s pre-filing requirements, e.g., Brown v. Ralphs Grocery Co., 28 Cal. App. 5th 824 (2018), and Khan v. Dunn-Edwards Corp., 19 Cal. App. 5th 804 (2018).

So, while much around PAGA remains unsettled, the emerging points of clarity regarding the applicable statute of limitations and pre-filing requirements will allow employers and litigators alike to evaluate and defend against the growing number of PAGA representative actions.