Without a doubt, California businesses should be celebrating the decisive Supreme Court victory in Viking River Cruises, Inc. V. Moriana.
The court’s ruling is a major blow to the Private Attorneys General Act (PAGA), a law that allowed employees to file class-action lawsuits against their employers for even the smallest perceived infraction of California’s 1,100-page labor code. The victory is worth celebrating, but the fight against PAGA is far from over.
PAGA has long been exploited by money-hungry trial attorneys to the detriment of California’s business owners. Minor mistakes, such as a typo on a pay stub, could be turned into multi-million dollar class-action lawsuits. A single disgruntled employee could file the lawsuit on behalf of all their coworkers without their consent.
Under the new court decision, workers can no longer file lawsuits on behalf of their colleagues. The court cited precedent noting that “arbitration is strictly ‘a matter of consent’” and class-action PAGA lawsuits often covered workers who had no interest in suing their employer.