Law360 — A proposed rule by California’s workforce agency isn’t clear enough about the planned oversight for punishing “vexatious filers” of Private Attorneys General Act notices, but firms that use the statute appropriately might not see much impact, said a top filer of such notices.
Elizabeth Parker-Fawley of Lawyers for Justice, P.C.® which is said to be among the top filers under California’s PAGA, said the proposed change would impact firms that file PAGA notices without intending to proceed with a lawsuit, more than firms like hers that almost always proceed with litigation.
“Although we do file more PAGA notices than maybe some other firms do, we actually follow through on those,” said Parker-Fawley, the firm’s senior director of litigation and director of prelitigation. “We’re not the type of high-volume firm where they’re just providing PAGA notices, getting a pre-litigation settlement and then never going forward with the PAGA claim.”
PAGA enables workers to sue on behalf of themselves, the state and other workers for labor law violations.
The Legislature amended PAGA in 2024. Then the state’s Labor and Workforce Development Agency in Feb. proposed the rule, which would establish new notice and certification requirements for firms that filed 200 or more notices in the previous month and extra procedures for “vexatious filers” of “repeated noncompliant, frivolous or harassing PAGA filings.”
The comment period closed in March, so a final rule could be forthcoming.
Lawyers for Justice, P.C. did not submit a public comment about the regulation, but at least three other firms that the California Business and Industrial Alliance identified as top filers did so, expressing opposition to the proposal. According to the trade group, Lawyers for Justice, P.C. submitted 1,578 PAGA filings since 2011.
Law360 spoke with Parker-Fawley about the firm’s PAGA strategy, the 2024 amendments and the proposed rule. This interview has been edited for length and clarity.
How are you connecting with workers and then deciding when to proceed with filing notices?
Potential clients reach out to us for a number of different reasons. Sometimes they saw an ad that was posted. Often, we’re referred by prior clients. They’ll call in to say the issues that they feel that they’re facing at work. We have an intake department that takes that information, and we review that through our senior attorneys.
Our high-level management is very involved in making sure that we’re taking on meritorious cases. We look at what they’re reporting to us, whether it sounds like there’s a violation there, who the employer is and whether they are in the state of California, what their presence is, whether they have pending litigation against them, all sorts of different factors.
Then some firms would proceed with just getting a retainer and filing from there. We prefer to, in most cases, request the personnel file and actually look at the records and see their time records, their pay records and do a deeper dive into that, so that we’re able to, one, confirm what they’re saying, and two, provide more detail in our PAGA notice and in our complaints.
And then once we have that, we … prepare their PAGA notice. It goes through a couple levels of review, and then we send it out to the LWDA and wait to see if we receive any comments from the defendant or comment from the LWDA.
What makes a good PAGA case?
You don’t necessarily want somebody who has a lot of non-wage-and-hour violations. If they have a lot of, potentially, discrimination or harassment claims, that might be a better avenue for that person to pursue [claims individually], because otherwise the issues can get a little bit muddled.
Our concern really is with protecting all of the aggrieved employees. Some firms, when they represent somebody for both the harassment and the PAGA claim, they end up maybe selling the PAGA claim short. We prefer to just focus on that PAGA claim and have somebody whose main focus is on the wage and hour issue.
And obviously, per code, we want somebody who has suffered the violations that they want to bring claims for, and that we’ve got some way to verify those violations. And there’s a statute of limitations issue as well.
How often does the notice result in a cure, compared to proceeding with a lawsuit?
We almost never receive a cure from defendants. I think I could count probably on two hands the number of times there’s been an offer of a cure. We do receive responses from defense counsel frequently in the form of just denying the allegations, but not in any sort of proffer of a cure.
How successful has your firm’s PAGA practice been for workers?
We’ve had a very successful PAGA practice. A lot of places use a PAGA notice more as a demand letter than an actual administrative exhaustion. We file, I would say, 99.9% of our cases, once a PAGA notice has gone out. There are rare instances where something happens for the client in the interim and they don’t want to proceed. But otherwise, we file those cases, and in the vast majority of our cases, we reach a settlement on a representative basis for those employees.
What changed about your PAGA practice after the 2024 amendments to the statute?
On the whole, not much has changed. One of the major features of the 2024 amendments was the introduction of the early evaluation conference, and there was a lot of discussion about that when the 2024 amendments came out. We haven’t really seen that make much of an impact on litigation.
Defendants just aren’t opting for the early evaluation conference. It’s just not a tool that’s being utilized, and when it is utilized, it doesn’t really do much. In our experience, it’s just too early in the process. No discovery has been done yet.
And similarly with how employers, at least in our cases, aren’t taking advantage of the prelitigation cure options, they’re also not coming into early evaluation conferences with any actual cure offers.
The thing with the cure is, they have to agree to make all of the aggrieved employees whole, and that means paying face value for these violations. So it’s something I don’t think employers are all that interested in. They would have just paid their employees in the first place.
How is your firm feeling about the proposed rule and how it would impact future filings?
We have a great respect and a great working relationship with the Labor and Workforce Development Agency. … We are actually moving forward with these cases, litigating them, we are paying the LWDA their share of the penalties that are recovered. So, even though we are higher-volume, we’re following the process, and I don’t believe that these rules are going to negatively impact our firm.
I could see it impacting some other firms that use PAGA in an inappropriate way. I do have some concern over the oversight of some of these terms, particularly the “vexatious filer,” it just doesn’t seem as fleshed out as it might be, and I would love to see what the oversight will be and what the appeal process will be. Because in the current version of the rules, I think there’s a lot left to be said about what that looks like.
How would it impact those other firms?
There are some firms where they provide a PAGA notice, but they’re using it less as an opportunity for the LWDA to investigate and for them to, in the alternative, move forward as a private attorney general. They’re using it more as a demand letter, so they are trying to seek a prelitigation settlement just on behalf of one client.
I could see those high-volume folks impeding the LWDA’s work because they can’t sort out who is actually moving forward on their cases versus who’s not. They’re just getting inundated with these letters on a daily basis.
So I could see those firms being more likely to get new labels attached to them. It may prohibit them when they do have meritorious claims. If you’re labeled a “vexatious filer,” you then have to get permission from the LWDA, and so it could negatively impact or delay their clients in being able to actually proceed with a PAGA case when they do intend to do that.
Credit: Max Kutner from Law360
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