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On June 15, 2022 the U.S. Supreme Court issued a ruling on Viking River Cruises v. Moriana regarding Private Attorney General Act (PAGA) claims.
PAGA allows individual workers to sue former employers in the state’s name for Labor Code violations, involving violations that happened to someone else in the company.
The Supreme Court decided that the PAGA rule does not prevent individuals from seeking arbitration on an individual basis.
California employers can now mitigate these claims individually with arbitration agreements as opposed to being at risk from broad representative PAGA claims.
This ruling should mean fewer PAGA claims, which have skyrocketed since 2014.
It is important to note that only employers with arbitration agreements precluding employees to file PAGA claims can benefit from the court’s ruling, which means companies that do not have arbitration programs in place should consider doing so.
