The U.S. Supreme Court’s decision last June in Viking River Cruises v. Moriana was viewed by many as a victory for employers. The Court allowed individual Labor Code Private Attorneys General Act of 2004 (PAGA) claims to be compelled to arbitration and required the dismissal of non-individual PAGA claims brought on behalf of others.  The case has resulted in a wave of motions in state and federal courts to compel arbitration of individual PAGA claims and to dismiss or stay non-individual PAGA claims.  

While most courts have granted motions to compel arbitration of individual PAGA claims, the aspect of the Viking River decision that requires non-individual PAGA claims to be dismissed if there is no PAGA plaintiff to pursue them has varied in outcomes. Federal courts have generally followed the guidance from Viking River and dismissed non-individual PAGA claims after compelling individual PAGA claims to arbitration.  State courts, on the other hand, are staying non-individual PAGA claims rather than dismissing them, preferring to wait for the California Supreme Court to clarify California’s law on PAGA standing when it decides the issue in Adolph v. Uber Technologies, Inc. 

For courts that stay non-individual PAGA claims pending arbitration of individual PAGA claims, the arbitrator must determine if the plaintiff is an “aggrieved employee,” defined by PAGA as “any person who was employed by the alleged violator and against whom one or more of the alleged violations was committed.” If the plaintiff is not an “aggrieved employee,” they would lack standing to pursue the non-individual PAGA claims.  

Western Growers will be eagerly anticipating and monitoring the California Supreme Court’s decision in Adoph which will shed further light on this evolving area of the law.  However, most practitioners do not anticipate the state high court to agree with the U.S. Supreme Court’s interpretation of California PAGA standing law, leaving California employers vulnerable to shakedown lawsuits. The best hope for PAGA reform remains the California Fair Pay and Employer Accountability Act, which Western Growers helped qualify for the 2024 ballot.