PAGA CLAIMS GET A BOOST FROM STATE’S HIGHEST COURT

 

The California Supreme Court has just “upped the ante” in the discovery phase of PAGA litigation. In Williams v. Superior Court, the court by unanimous decision, held that PAGA plaintiffs have the same broad discovery rights to obtain the names and contact information of other California employees that they would have if the case was filed as a class action. The court also ruled that plaintiffs are permitted to seek the contact information for their fellow “aggrieved employees” at the outset of their lawsuit, without a showing of good cause for the potentially private information. The court remarked that “nothing in the characteristics of a PAGA suit . . . affords a basis for restricting discovery more narrowly” than in non-PAGA class actions.

The Williams decision is likely to have a serious impact on PAGA litigation, as plaintiffs’ attorneys are now more likely than ever to seek the names and contact information of other California employees within a company at the outset of litigation. Producing this type of information not only raises privacy concerns for the employees whose names are released, but also creates potential for increased litigation costs associated with gathering and producing such information in PAGA claims to increase dramatically.

Background on PAGA

Becoming law in 2004, PAGA has since become the source of much controversy for employers. Generally, PAGA authorizes “aggrieved employees” to file lawsuits to recover civil penalties on behalf of themselves, other employees, and the State of California, for labor code violations. In recent years, there has been a significant uptick in the number of PAGA claims being filed. In fact, many have commented that the amount of PAGA claims being filed have now surpassed traditional employment class actions in many jurisdictions. The Williams case is the latest California Supreme Court decision to provide guidance on the scope, timing, and procedures for discovery in PAGA litigation.

The Williams Case

Plaintiff Michael Williams brought an action under PAGA, alleging Marshalls failed to provide its employees with meal and rest breaks, did not provide accurate wage statements, and neglected to reimburse employees for necessary business-related expenses. Williams sought to bring the claim on behalf of himself and other similarly “aggrieved employees” in the State of California.

Williams initially served discovery seeking the names and contact information of all nonexempt Marshalls employees in California who had worked for the company dating back one year from the filing of his lawsuit. The trial court granted  Williams’ motion to compel in part, allowing discovery solely as to the employees at the store location where Williams worked, and denied production of contact information of employees at any other of Marshall’s other stores in California.

On appeal, the Second District affirmed the trial court’s decision, refusing to allow this type of statewide discovery of Marshall’s employees.  The Second District noted that nowhere did the plaintiff “evince any knowledge of the practices of Marshalls at other stores, nor any fact that would lead a reasonable person to believe he knows whether Marshalls has a uniform statewide policy.” The Second District further observed that “[p]laintiff’s proposed procedure, which contemplates jumping into extensive statewide discovery based only on the bare allegations of one local individual having no knowledge of the defendant’s statewide practices would be a classic use of discovery tools to wage litigation rather than facilitate it.”

However, the case made its way to the California Supreme Court. The Supreme Court disagreed, allowing the statewide discovery. The Supreme Court reasoned that the broad statutory language of PAGA, which allows a plaintiff to bring suit on behalf of any “aggrieved employee,” did not imply a heightened evidentiary or pleading requirement.

What Williams means for Employers

The Williams decision means that plaintiffs are now likely to seek private contact information of other “aggrieved employees” on a statewide basis very early in the discovery process. While the decision is unfavorable for California employers, courts still retain broad discretion to fashion discovery limitations on a case by case basis as they deem necessary. Additionally, as noted in the California Supreme Court’s decision, the use of “Belaire-West” notices are one mechanism employers can continue to require before they disclose the private contact information of their employees in PAGA litigation. The case also serves as a reminder that employers should ensure compliance with meal and rest break and other labor laws. For more information on compliance with these and related laws, contact Brown Law Group.

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