Business, labor fight over California law few know about

Business and labor are gearing up to go head-to-head on Californians’ ballots again — this time over a consequential 20-year-old state labor law you’ve probably never heard of. 

The two sides released dueling reports this week extolling the virtues, or sins, of the state’s Private Attorneys General Act, which major employers’ groups such as the California Chamber of Commerce are campaigning to repeal via the November ballot. 

The law — and a recent string of court decisions over its scope — is deep in the weeds, but here’s the gist of it:

Workers claiming labor law violations, such as wage theft, can ask the state Labor Commissioner’s Office to investigate, and either cite or sue the employer. 

The Private Attorneys General Act offers another option. It lets the state outsource the suing to private attorneys, with a worker taking the place of the state as the plaintiff. If the worker wins, the private lawsuit — just like a suit brought by the state — is used to collect a payout for them and their coworkers. The state gets most of the cut, because workers using this law are suing for state penalties.

Labor groups like the law because it bulks up capacity for the state Labor Commissioner’s Office. So do the attorneys who bring these cases on behalf of workers and collect legal fees. 

Business groups hate the law, saying it enriches lawyers while subjecting numerous businesses to costly suits over technical violations. A coalition of business groups qualified a ballot measure two years ago to repeal the law. The group has reported receiving $15 million for the campaign in the last month. 

Wednesday, they released a report authored by three former state labor officials finding that workers participating in the lawsuits got less money from the payouts than workers participating in a successful state investigation. Workers also waited longer for an award, the report said. 

Today, the UCLA Labor Center and two advocacy groups issued their own report, saying that without the private lawsuits, the state’s Labor Commissioner’s Office doesn’t have the capacity to take on thousands of new complaints of wage theft. And some workers don’t have other options because many employees are subject to agreements in which they’ve given up the right to sue their employers directly, the report said.

The sides could reach a deal and get the Legislature to pass a bill making changes to the law in exchange for pulling the repeal measure off the ballot — as business and labor did last year when agreeing on a new minimum wage for fast food workers. 

Business groups propose making complaints processed by the state get resolved faster, and reducing the amount attorneys can collect from payouts. They spent more than $800,000 lobbying the Legislature on overhauling the law in the last three months of 2023.

A deal would have to materialize before an end-of-June deadline to pull measures off the November ballot. Otherwise, the esoteric issue goes to the voters.