What's Happening?
The Fifth Appellate District in California has ruled that 'headless' PAGA claims are permissible, allowing PAGA representative plaintiffs to disavow the individual portion of a PAGA claim. This decision came in the case of CRST Expedited Inc. v. Superior Court of Fresno County, where the court interpreted the word 'and' in the Labor Code as 'and/or,' thus permitting claims that do not include other employees. This interpretation contrasts with previous rulings that required PAGA claims to include other employees. The decision is binding only in the Fifth Appellate District, covering several counties in the Central Valley, and applies to the pre-July 2024 amendment version of PAGA.
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Why It's Important?
This ruling could significantly impact labor law enforcement in California, particularly in the Central Valley. By allowing 'headless' PAGA claims, the decision may lead to more individual lawsuits under PAGA, potentially increasing litigation costs for employers. It also highlights a split in authority between different appellate districts, which could lead to further legal challenges and uncertainty until the California Supreme Court resolves the issue. Employers and employees alike may need to adjust their strategies in PAGA litigation, depending on the jurisdiction.
What's Next?
The California Supreme Court is expected to address the split in authority between the Fifth Appellate District and other districts, such as the Second Appellate District, in its review of related cases like Leeper v. Shipt and Williams v. Alacrity Solutions Group. This decision will be crucial in determining the future of PAGA claims and whether 'headless' claims will be permissible statewide. Stakeholders in labor law, including employers, employees, and legal professionals, will be closely monitoring these developments.
