Small businesses need PAGA reform

Earlier this year, the California Legislature passed up an easy opportunity to improve the state’s infamously bad business climate. Assembly Bill 2530 would have required notification to employers of specific Labor Code violations and possible remedies before an employee could file a lawsuit over those issues.

The bill, introduced by Assemblyman Vince Fong, R-Bakersfield, stalled in its first committee without ever having a hearing.

AB2530 was a much-needed attempt to curb a type of abusive lawsuit against businesses, especially small businesses, that exploits a state law to coerce employers to pay quick settlements or face potentially massive fines. The law is the Private Attorney General Act, signed by Gov. Gray Davis as he was on his way out of office.

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