California Supreme Court Rules That PAGA Cases Cannot Be Dismissed Due to Unmanageability

The California Supreme Court recently ruled that trial courts cannot dismiss Private Attorneys General Act (PAGA) cases due to unmanageability. This decision was made in the case of Estrada v. Royalty Carpet Mills. Claiming that a PAGA claim was unmanageable was a strong defense for employers facing PAGA cases. Now, employers can no longer use this defense. However, while trial courts are barred from dismissing PAGA claims on the grounds that they would be unmanageable to try in court, there are still various other means for dismissing or limiting PAGA claims.

What are PAGA Claims?

The Private Attorneys General Act, or PAGA, is a California law that allows aggrieved workers to bring lawsuits against current or former employers who violate the California Labor Code to recover civil penalties on behalf of themselves, other workers, and the state for those violations. An aggrieved worker is a worker who has suffered from a labor violation. Generally, PAGA gives employees the power to act as “private attorneys general” and pursue civil penalties like they were a state agency.

If an employee files a PAGA claim and succeeds, 75% of the monetary penalties go to the state of California, and the remaining 25% goes to the aggrieved employees. In regards to the statute of limitations, employees have a year from the date of the last violation to bring a PAGA lawsuit. If an employee files a PAGA claim after the statute of limitations has expired, the claim will be thrown out.

About the Case of Estrada v. Royalty Carpet Mills

In this case, a group of workers sued Royalty Carpet Mills for failing to provide required meal breaks. Initially, Estrada filed a PAGA representative claim against the defendant. Then, 12 additional workers joined Estrada as named claimants.

The defendant argued that it was necessary to dismiss the case to preserve judicial resources. The trial court dismissed the case on the grounds that it was unmanageable. The plaintiffs appealed the ruling to the Fourth Appellate District, and the court reversed the trial court’s decision. The court ruled that unmanageability is not a valid reason for dismissing a PAGA case. Royalty Carpet Mills argued that the Appellate Court’s decision to allow the case to proceed violated its due process rights. The company claimed that trial courts have the power to dismiss claims to prevent trials from becoming time-consuming and excessively complex. However, the California Supreme Court disagreed and affirmed the Fourth Appellate District’s decision. The state supreme court held that trial courts do not have inherent power to dismiss PAGA claims on manageability grounds. The state supreme court stated that dismissal is only allowed when the claimant lacks a valid cause of action or has failed to prosecute diligently.

The state supreme court’s decision makes trying PAGA cases easier for employees as employers can no longer argue that a lawsuit should be dismissed because it is time-consuming or excessively complex. This may result in more and more employees coming forward and filing PAGA claims.

Contact a California Employment Lawyer

If you need more information or help with a PAGA case, contact a California employment lawyer near you.