California PAGA Reforms Introduce New Compliance Defense for Employers
TL;DR
California employers can now significantly reduce PAGA penalty exposure by demonstrating proactive compliance efforts before receiving violation notices.
The 2024 PAGA amendments require documented auditing, record-keeping protocols, and management training to establish the 'all reasonable steps' defense.
These reforms create a fairer employment enforcement system that rewards diligent compliance rather than punishing minor technical errors.
California's PAGA law underwent a fundamental restructuring in 2024, shifting from pure litigation to a compliance-based penalty reduction system.
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On June 19, 2024, significant amendments to the California Private Attorneys General Act took effect through the passage of new legislation, fundamentally restructuring the state's employment enforcement landscape. These changes, enacted through AB 2288 and SB 92, replace the previous litigation-focused framework with a new legal standard centered on documented employer diligence and compliance. For two decades, PAGA has served as a source of substantial financial liability for California businesses, where minor technical errors could accrue into massive civil penalties.
The 2024 reforms introduce a new paradigm shift that, for the first time, offers employers a mechanism to significantly reduce their exposure. The core change concerns an employer's ability to assert a new affirmative defense. By successfully demonstrating that a company took all reasonable steps to comply with the Labor Code before receiving a PAGA notice, a court may drastically reduce the potential penalties. The specifics of defining and documenting these necessary compliance steps, including detailed auditing, record-keeping protocols, and management training, are now essential for liability mitigation.
Human capital compliance professionals note that immediate and proactive adoption of this new standard is critical. The complete analysis details the essential elements required to build a defensible Reasonable Steps file and secure the substantial penalty reductions available under the revised law. Access the Full Compliance Playbook Here to Understand the All Reasonable Steps Requirements at https://windes.com.
Curated from 24-7 Press Release
