Newsom, companies and labor associations agree to solve problematic labor laws

Business and labor associations have agreed on new legislation to address their problems with the Private Attorneys General Act.

Once the new law is passed, supporters of a ballot measure to repeal and replace the Private Attorneys General Act will withdraw it from the ballot.

The background story: The Private Attorneys General Act came into force in 2004 and allows employees to act as private attorneys general and sue companies for labor law violations.

• You do not have to be the victim of the alleged injury yourself; you can also sue on behalf of someone else.

• Business groups have pushed for a vote that would repeal the law and expand the Labor and Workforce Development Agency’s processes to resolve workers’ claims more quickly and award more compensation.

The big picture: California Governor Gavin Newsom announced Tuesday that labor and business groups had agreed to reform the Private Attorneys General Act to strengthen worker protections, encourage employer compliance and simplify litigation in an effort to defeat the ballot measure.

• The new law limits penalties for employers who take prompt action to change their policies and practices.

• In addition, the law provides for new and higher penalties for employers who maliciously, fraudulently or oppressively violate labor laws. In addition, the amount of fines to be paid to employees increases from 25 to 35 percent.

Go deeper: In addition, the new legislation expands the scope of sections of employment law under which claims can be brought in order to reduce the need for litigation and thus speed up proceedings for employees.

• Small employers will be protected by a more robust appeals process through the Labor and Workforce Development Agency to reduce litigation and costs.

• The courts will have the power to limit the scope of claims brought before the courts in order to ensure effective handling of cases.

• The new law will also allow courts to seek injunctive relief to force companies to make workplace changes to address labor law violations, requiring that workers have personally experienced the alleged violations brought forward in the lawsuit.

What you say: “We sat down at the bargaining table and negotiated a deal that works for both businesses and workers and makes needed improvements to this system,” Newsom said. “This proposal continues to provide strong protections for workers, provides incentives for businesses to comply with labor laws, and reduces litigation.”