
By Jennifer A. Riley
Duane Morris Takeaway: The California Private Attorneys General Act (PAGA) inspired more representative lawsuits than any other statute in America over the past year. According to the California Department of Industrial Relations, plaintiffs filed more than 9,464 PAGA notices in 2024, a nearly 22% increase over 2023, and a whopping 85,936% increase over the 11 PAGA notices filed in 2006. The so-called PAGA reform legislation passed in 2024 by California lawmakers seemingly did little to nothing to curb interest in these cases, which continue to present one of the most viable workarounds to workplace arbitration agreements.
Watch the video below to see Jennifer Riley explain this trend in detail:
The PAGA created a scheme to “deputize” private citizens to sue their employers for penalties associated with violations of the California Labor Code on behalf of other “aggrieved employees,” as well as the State. A PAGA plaintiff may pursue claims on a representative basis, i.e., on behalf of other allegedly aggrieved employees, but need not satisfy the class action requirements of Rule 23. In other words, the PAGA provides the plaintiffs’ class action bar a mechanism to harness the risk and leverage of a representative proceeding without the threat of removal to federal court under the CAFA and without the burden of meeting the requirements for class certification.
If successful in prosecuting such a case, aggrieved employees receive 25% of any civil penalties and pass the other 75% to the California Labor and Workforce Development Agency (LWDA). The plaintiffs’ attorneys who pursue the action may collect their attorneys’ fees and costs.
According to data maintained by the California Department of Industrial Relations, the number of PAGA notices filed with the LWDA has increased exponentially over the past two decades. The number grew from 11 notices in 2006, to 1,606 in 2013, and then experienced three sizable jumps – to 4,530 in 2014, to 5,732 in 2018, and to 7,464 in 2023, each coinciding with a significant shift in the legal landscape, as discussed below. In 2024, notices exceeded 9,464 for the first time, an all-time high.
From 2013 to 2014, employers saw the largest single year increase, from 1,605 notices in 2013 to 4,532 notices in 2014, an increase of 182%. The most significant drop in the past two decades occurred in 2022, when notices fell from 6,502 in 2021 to 5,817 in 2022, before their resurgence in 2023 and continued growth in 2024. The following chart illustrates this trend.

These numbers closely tie to the shifting landscape of workplace arbitration, as discussed below, in that each of the major shifts coincides with the timing of a significant expansion or pull back in the law governing the enforcement of arbitration agreements.
PAGA Reform seemingly has had little to no impact on the growth on PAGA filings. On June 18, 2024, Governor Newsom announced that labor and business groups had inked a deal to alter the PAGA in return for removing the referendum to repeal the PAGA from the November 2024 ballot. The California Legislature quickly moved to approve two bills (AB 2288 and Senate Bill 92). The alterations include reforms to the penalty structure, new defenses for employers, changes to the PAGA’s standing requirements, and a new “cure” process for both small and large employers, among other changes. These reforms affect all PAGA notices filed on or after June 19, 2024, with some exceptions.
- The PAGA As A Work-Around To Arbitration
The growing adoption of arbitration programs has led the plaintiffs’ class action bar to identify work-arounds, and the PAGA has emerged as one of the most popular.
The California Supreme Court cemented the PAGA as the frontrunner for employment-related claims with its decision in Iskanian, et al. v. CLS Transportation Los Angeles, 59 Cal.4th 348 (Cal. 2014). The California Supreme Court held that representative action waivers in arbitration agreements are “contrary to public policy and unenforceable as a matter of state law.” Id. at 384. In so holding, Iskanian established the PAGA as a mechanism by which a plaintiff could pursue a representative action unhindered by arbitration agreements or commitments to arbitrate on an individual basis. The decision undoubtedly fueled the filing of PAGA notices in 2014, which catapulted from 1,606 in 2013 to 4,530 in 2014.
The PAGA-workaround movement suffered its first significant set-back in 2022 with the U.S. Supreme Court’s decision in Viking River Cruises, Inc. v. Moriana, et al., 142 S.Ct. 1906 (2022). In Viking River, the U.S. Supreme Court held that, to the extent Iskanian precludes division of PAGA actions into individual and non-individual claims, and thereby “prohibit[s] parties from contracting around this joinder device,” the FAA preempts such rule. Id. The Supreme Court opined that the PAGA provides no mechanism to enable a court to adjudicate non-individual claims once an individual claim has been committed to a separate proceeding. As a result, the U.S. Supreme Court opined that Moriana lacked statutory standing to continue to maintain her non-individual claims in court, and, after compelling arbitration of the plaintiff’s individual PAGA claims, the lower court should have dismissed the PAGA representative claims. Id.
The set-back was short lived as, in 2023, the California Supreme Court minimized the impact of the Viking River decision. In Adolph v. Uber Technologies, Inc., 14 Cal. 5th 1104 (Cal. 2023), the California Supreme Court took up the issue of whether, under California law, a PAGA plaintiff whose individual PAGA claims are compelled to arbitration retains standing to bring representative PAGA claims. The California Supreme Court answered the question in the affirmative. It disagreed with the U.S. Supreme Court’s interpretation of California law and held that, once a PAGA plaintiff’s individual claims are compelled to arbitration, the plaintiff retains standing to maintain non-individual PAGA claims in court so long as he is an “aggrieved employee.” Id. at 1105. By deciding that an individual who signs an arbitration agreement can return to court after arbitration to pursue representative proceedings under the PAGA, the California Supreme Court relegated arbitration agreements to a mere hurdle rather than a bar to PAGA representative actions.
Although Viking River and Adolph are a mere one and two years old, respectively, the plaintiffs’ bar is continuing to attempt to find ways to eliminate the arbitration hurdle all together and to allow plaintiffs to proceed with their representative actions in court. One emerging trend is for plaintiffs to file complaints seeking to pursue only representative components, explicitly excluding their individual PAGA claims. These claims informally have become known as “headless” PAGA claims.
While this line of reasoning seemingly goes against the ruling in Adolph and other cases, which have held that a PAGA claim necessarily consists of both and individual and representative portion, the California Court of Appeal supported it in April 2024 with its decision in Balderas, et al. v. Fresh Start Harvesting, 101 Cal.App.5th 533 (2024). In that opinion, the California Court of Appeal denied a motion to compel arbitration, holding that a plaintiff could maintain a representative PAGA action, even without an individual PAGA claim, so long as the plaintiff alleges that he or she suffered a Labor Code violation.
We expect parties to heavily litigate this line of reasoning in 2025, with multiple appeals already filed as to rulings that follow the Balderas “headless” PAGA standard.
Given the technical requirements of California wage & hour law, coupled with the potentially crushing statutory penalties available to successful plaintiffs, employers should anticipate continued growth of PAGA lawsuits in 2025.