Private Attorneys General Act Review – 2025

to ensure compliance with Labor Code provisions. This is reminiscent of the injunctive relief available to plaintiffs under California’s Unfair Competition Law. Labor interests had identified this provision as a key priority for PAGA reform and comments from representatives from the business community reflect the common interest in working towards full compliance with the Labor Code for all employers and employees. New Early Evaluation Procedures For Large And Small Businesses The reforms introduce new procedures with the LWDA and the courts to allow for effective litigation, and potential early resolution, of these claims. For PAGA notices (and their associated claims) filed on or after June 19, 2024, employers who employed at least 100 employees during the PAGA period can now request an “early evaluation conference” and a request to stay the proceedings before or simultaneous with the employer’s responsive pleading. This request must include a statement from the employer identifying which allegations it disputes and which allegations it will cure. The court will then set an early evaluation conference. To the extent the employer stated that it would cure any of the alleged violations, the court may also ask the employer to submit to the neutral and the plaintiff, on a confidential basis, the employer’s plan to cure the deficiencies. If other violations remain in dispute, the neutral may stay the consideration of the cure plan or agreement until after the litigation of the disputed issues. If the neutral approves the cure plan, the employer must submit evidence within ten (10) days showing that the cure occurred. If the neutral, employer, and employee all agree the violations have been cured, they are to submit a joint statement to the court setting forth the terms of their agreement. If the neutral or employee do not agree that the violation was cured, the employer may file a motion to request the court to approve the cure. The employer can submit evidence with this motion showing that the alleged violations were corrected. Any PAGA penalties calculated with these cures must take in to account other limitations and caps on penalties that would be applicable due to the prompt cure. Smaller employers have a separate early evaluation process. Before October 1, 2024, employers with fewer than 100 employees during the PAGA period cannot take advantage of this early conference. However, as of October 1, 2024, employers with under 100 employees can now submit a confidential proposal to the LWDA within 33 days of their receipt of notice that lays out their exact plan for the cure. The LWDA is to make a determination on the sufficiency of the cure at the outset or set a conference to determine the sufficiency of the cure. If the cure is facially sufficient or if the LWDA believes a conference is needed to discern the sufficiency of the cure, the LWDA will set a conference. This is an accelerated timeline, as the LWDA must rule on the plan within 14 days of its submission and the conference must occur within 30 days of that date. At this conference, the LWDA will discern if the cures are sufficient, whether or not any additional information is needed, and set a deadline to complete the cure. When the employer completes the cure, it must provide to the LWDA and the plaintiff a sworn notification to the employee and agency that the cure is completed, accompanied by a payroll audit and check register if the violation involves a payment obligation. The LWDA must confirm whether the cure was completed within twenty days of receiving the cure documents. If the LWDA preliminarily believes the violation has been cured, the LWDA must provide notice to the plaintiff that the cure is complete. If a plaintiff disagrees with the decision, the plaintiff may request a hearing on that determination. If the LWDA confirms the violation was cured, the employee cannot continue with a civil action. The employee can also appeal this determination to the superior court, although any payment the plaintiff received as part of the cure process will offset any judgment later entered with respect to that violation if the superior court concludes the agency abused its discretion in finding the cure was adequate. In circumstances where the LWDA believes the cure proposal is not sufficient, the employee can proceed with a civil action. Importantly, if this process extends beyond the 65-day timeframe for the investigation by the LWDA, the statute of limitations on the PAGA claims are tolled. As of October 1, 2024, employers with fewer than 100 employees during the PAGA period can also request the early evaluation conference described above for larger

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