The California Chamber of Commerce is calling on the state to temporarily suspend a state law that makes it easier for employers to be sued during the COVID-19 pandemic.
The Private Attorneys General Act should be suspended for at least a year, the Chamber said in a May 26 letter to Gov. Gavin Newsom and members of the state legislature.
Under the act, an employee can file a lawsuit for alleged labor violations on behalf of themselves, all other affected employees and the State of California. Critics say attorneys use the law to force employers to pay settlements for minor mistakes.
As the COVID-19 pandemic hit, employers had to quickly transform their workplaces.
“Employers reacted quickly with new workplace arrangements, such as telecommuting and new distancing and attendance practices, while trying to accommodate a chaotic market and new government costs and mandates,” the Chamber said, according to Cal Chamber Advocacy.
If the act is suspended, the state’s labor commissioner would retain the power to respond to employee complaints.
“The Labor Commissioner would retain her sweeping enforcement authority to remedy any labor violation and provide an employee with the full amount of damages owed,” the letter said, reported by Cal Chamber Advocacy.
The Labor Commissioner has the discretion to “determine whether a violation is willful and whether penalties are appropriate,” the Chamber continued. “California does not need to further enrich trial attorneys with abusive PAGA claims at the expense of the state’s struggling economy.”
The California Business and Industrial Alliance applauded the Chamber’s call for a suspension of the law.
“Our organization was the first one to send such a request on March 25,” said Tom Manzo, founder of the California Business and Industrial Alliance. The California Labor Federation immediately urged the governor to oppose the move, Manzo said.
“It is unfortunate that labor is so misguided by this law,” Manzo told the Southern California Record. "In their quest to unionize, they are hurting small- to medium-sized businesses daily by helping legislators create the most complex labor laws in the nation.”