PAGA ABUSES

Lawsuit-First Approach Has
Failed Workers

In 2017, a PAGA lawsuit was filed against a non-profit serving individuals with disabilities, claiming failure to provide overtime wages. After the non-profit immediately reconciled the wage issue, the plaintiff’s attorneys added a claim to the lawsuit because the name of the organization was shortened to “Inc.” on paystubs. This additional claim resulted in attorneys receiving approximately $200,000 and workers receiving $61.18 each.

3 YRS
$550k
$200k
Only
$61.18

In 2021, a PAGA lawsuit was filed against a staffing company for a minor paystub error, alleging that pay period dates were not labeled correctly. After 2 years of litigation, the parties reached a $600,000 settlement. The plaintiffs’ attorneys pocketed $175,000, while the average worker received $35.75 each.

2 YRS
$600k
$175k
Only
$35.75

In 2014, trial lawyers filed a class action PAGA lawsuit against a rideshare company over worker classification. After 3 years of litigation, the parties reached a $7.75 million settlement. The plaintiffs’ attorneys pocketed $2.3 million, while the drivers only received $1.08 each.

3 YRS
$7.75M
$2.3M
Only
$1.08

In 2011, a trial lawyer filed a PAGA lawsuit against a grocery store chain alleging the supermarket did not provide adequate seating for cashiers. After 8 years of litigation, the parties reached a $12 million settlement. The plaintiffs’ lawyers pocketed $4.2 million, while the cashiers only received on average $62 each.

8 YRS
$12M
$4.2M
Only
$62

In 2016, a trial lawyer filed a PAGA lawsuit against a technology company alleging their employee confidentiality policies violated state statutes. After 7 years of litigation, the parties entered a $27 million settlement. The plaintiffs’ lawyers walked away with $9 million, while workers only received $20 each.

7 YRS
$27M
$9M
Only
$20

In 2008, a trial lawyer filed a PAGA lawsuit against a specialty coffee retailer for misstating the company’s name on pay stubs and other alleged violations. After 5 years of litigation, a $4.9 million settlement was reached. The plaintiff’s lawyers raked in $1.9 million, while the workers on average only received a couple hundred dollars each.

5 YRS
$4.9M
$1.9M
Only
~$200

In 2016, a trial lawyer filed a PAGA lawsuit against a home improvement retailer alleging wage-and-hour violations, including not compensating workers for the time spent walking from the store entrance to clock in. Following 7 years of litigation, the parties reached a $72.5 million settlement. The plaintiff’s lawyers pocketed nearly $24 million, while workers only received up to $77 each.

7 YRS
$72.5M
$24M
Only
$77

In 2017, a PAGA lawsuit was filed against a non-profit serving people with disabilities, alleging minor violations of California’s complex wage and hour regulations. After nearly 2 years of litigation, the parties reached a $250,000 settlement. The plaintiffs’ attorneys and settlement administrators pocketed over $113,000, while workers only received from a few dollars to up to $2,000 each. The nonprofit subsequently made the decision to close the service for people with disabilities due to cost pressures associated with the settlement.

2 YRS
$250k
$113k
Only
$2k

In 2019, a PAGA lawsuit was filed against a non-profit that serves individuals in the disabled community, alleging wage-and-hour violations, including non-verifiable claims. After 2 years of litigation, the parties reached a $335,000 settlement. The plaintiffs’ attorneys received $195,000 while workers received less than one hundred dollars each. The non-profit was forced to enter into a payment plan to keep their doors open and continue providing vital services.

2 YRS
$335k
$195k
Only
$97

In 2019, a PAGA lawsuit was filed against a housing and services provider caring for people with disabilities, alleging missed meal and rest periods despite legal waivers that allow for on-duty breaks to occur. After nearly five years of litigation, the parties will be reaching a $200,000 settlement. The plaintiffs’ attorneys are seeking a staggering 40% of the total recovery, while workers will likely only receive 0.9% (about $18).

5 YRS
$200k
$80k
Only
$18

In 2017, a PAGA lawsuit was filed against a family-owned restaurant business in Southern California. After two years of litigation, the parties reached a $380,000 settlement. The plaintiffs’ attorneys pocketed approximately $180,000, while workers received an average of $38.17 each. The lawsuit has prevented the business from continuing to invest in additional employee benefits, where their funds are better spent to serve their employee population and increase job security.

2 YRS
$380k
$180k
Only
$38.17

PAGA is Devastating Non-Profits and Small Businesses

  • ”We’ve been a part of the San Diego community for three decades. I cherish my employees and feel an immense sense of pride in providing the community with fresh baked goods and authentic espresso. But my experience with PAGA has been nothing short of heartbreaking. I don’t know how we’re going to keep our doors open.”

    Local Café & Bakery Owner

    San Diego, CA

  • "As a non-profit that provides support for adults with developmental disabilities and their families, we operate with very tight margins and don’t have hundreds of thousands of dollars to fight expensive PAGA lawsuits. We care deeply about those we serve, and our employees are essential in providing the continuum of care and resources our clients need, but if we’re hit with another lawsuit, we may not be able to continue to provide our critical services. This would be devastating for one of the most vulnerable populations throughout California.”

    Disability Services Non-Profit

    Northern California

  • “I’m a proud wife and mother to three young girls. I opened a franchise location to provide our family with a way to save and prepare for the future. Unfortunately, everything could come to a screeching halt. After being served with a PAGA lawsuit, I feel like I’m being extorted. Our legal fees are piling up and we’re already having to explore difficult operational decisions to keep our doors open. Unfortunately, we’ll likely never open a business in California again.”

    Local Franchise Owner

    Central Valley

  • “For almost 50 years, our family business has delivered physical, occupational, and various critical health services to patients throughout Northern California. Several years ago, we were hit with a PAGA case that is still in progress and will ultimately take hundreds of thousands of dollars to resolve. Dollars that could and should have been directly put back into the business in the form of higher wages, improving our facilities for our employees and patients and/or potentially opening up another facility in another community. This is not about us as an employer. This is directly affecting our staff and patients. It’s time to reform PAGA to help both workers to thrive and businesses to survive.”

    Physical, Occupational, & Critical Health Services Provider

    Northern California

  • “We provide person-centered services and resources to empower and support hundreds of individuals with intellectual and developmental disabilities. Being targeted by a PAGA suit due to the unique nature of our work is threatening to shut our doors. It's devastating to think about how losing these services could impact the most vulnerable in our community. We’re going to fight this lawsuit, but it will cost us and those we support in more ways than one.”

    An Intellectual and Developmental Disability Services Non-Profit

    Southern California

  • “We support thousands of individuals with disabilities, people with mental health diagnoses, and young adults in Central and Southern California. One of the resources we provide to individuals is helping to strengthen workplace skills so they can feel empowered and confident as members of their community. So, to have a frivolous PAGA lawsuit filed against us over a non-existent or minor workplace issue is detrimental to our existence. PAGA needs to be reformed to ensure non-profits aren’t continually and unfairly targeted.”

    An Intellectual and Developmental Disability Services Non-Profit

    Central and Southern California

  • “We’re very proud to help connect businesses and workers throughout California, fostering opportunities that create professional and economic growth. Unfortunately, my business was targeted by a PAGA lawsuit due to misplaced dates on paystubs. This process has been beyond stressful and devastating. This abusive system needs to be reformed.”

    Staffing Company

    California

  • “The mental and behavioral health services we provide directly impact the well-being of hundreds of individuals throughout Northern California. Being hit with a PAGA suit absolutely has hurt our ability to provide services to those most in need in our community. This system is deeply broken, and it’s hurting patients - we need to reform PAGA.”

    A Mental and Behavioral Health Non-Profit

    Northern California

  • “We’re a family-owned business that has been a part of our community for over 40 years. Our employees are helping cultivate our dream and we always strive to provide them with the flexibility they need. Now, after dealing with an abusive PAGA lawsuit, we can’t offer that same flexibility out of fear that someone will take advantage of PAGA’s broken system again.”

    Restaurant Owner

    Sacramento Region

  • "It’s always been my dream to run my own business, and I’ve been fortunate enough to keep the doors open for nearly 20 years. But my experience with PAGA has turned running my restaurant into a nightmare. A simple third-party payroll error cost me thousands of dollars in legal fees. Now I’m worried. Will I be extorted next for a benign clerical mistake?"

    Restaurant Owner

    Riverside Area

  • “Our organization helps support individuals with intellectual and developmental disabilities and Veteran families who are experiencing homelessness or are at risk of becoming homeless. To put it simply, our experience with PAGA has been heartbreaking and has hampered our ability to provide critical, community-based services. PAGA is being abused and gravely impacting thousands of non-profit organizations like ours that are providing care and resources to some of California’s most vulnerable populations.”

    An Intellectual and Developmental Disability Services Non-Profit

    San Diego Region

  • “Our non-profit provides exceptional services to hundreds of individuals with disabilities. We also honor and appreciate our dedicated staff. It’s been exasperating to see money that we can ill afford to lose be unjustly taken by frivolous lawsuits and attorneys that are regularly targeting non-profits like ours. We couldn’t afford to fight the claims levied against us and when the lawsuit was settled, we had to enter into a payment plan to keep our doors open. This lawsuit will affect our agency for years to come.”

    A Developmental Disability Non-Profit

    Los Angeles

  • “We have been a leading provider of housing and services, support, and advocacy for intellectually and developmentally disabled individuals for almost three decades, and receive most of our funding through the state and federal government. Bad actors in the legal industry have repeatedly targeted providers like us because they know we don’t have the resources or bandwidth to go through prolonged litigation while continuing to provide care. PAGA is being abused, and lawmakers need to act to prevent dishonest lawyers from diverting much-needed taxpayer funding that supports the disabled population we serve”

    An Intellectual and Developmental Disability Services Provider

    Southern California

  • “My parents started our family-owned restaurant business nearly 40 years ago after immigrating to the United States. We’ve been fortunate enough to be able to expand and invest in our employees, including offering student loan repayment. Unfortunately, frivolous PAGA lawsuits have forced us to cut back on investing in employee benefits and development. We need a better system that partners with employers and helps educate on how to navigate California’s complex Labor Code, while ensuring employees receive everything they are rightfully owed. PAGA is not a proper solution—our goal as community members and business owners is to ensure we are taking care of our community, and that is through serving our employees as well. While the intention of the Legislature may have been to protect and empower employees, PAGA has instead served to siphon away funds we were investing into our employees’ futures to legal costs.”

    A Family-Owned Restaurant Business

    Southern California

Join us in support of a
better, fairer way
for California workers