Laura Reathaford

Reathaford’s expertise in the Private Attorneys General Act means she’s constantly litigating on the frontier of labor law.

“The thing about PAGA is it’s all cutting-edge,” she said.

The 2004 Labor Code statute that allows aggrieved employees to file lawsuits to recover civil penalties on behalf of themselves, other employees and the labor commissioner is still evolving, leaving labor and employment attorneys to frequently navigate novel territory.

Reathaford is currently representing an employer before the California Court of Appeal on an issue of first impression: whether the labor commissioner can collect civil penalties for claims which had been released by PAGA plaintiffs and class members in a prior class action settlement.

After settling a wage and hour class action with the employer and judgment was entered, the labor commissioner said several months later that the office didn’t like the settlement and wanted additional money. The named plaintiff had been appointed by the labor commissioner as a PAGA plaintiff, so they collected a civil penalty from the suit.

“It’s an issue that there’s no guidance on, otherwise I probably would have been more successful at the trial court,” Reathaford said. “There’s no case law on it whatsoever.”

Looking at the legislative history of PAGA, Reathaford said the court’s role was to protect employers from unfair settlements, not “to make sure the state got all its money,” she said.

The appeal has been filed, but Reathaford’s team hasn’t been briefed on it yet, she said.

Reathaford also recently represented the Association of Southern Defense Counsel as amicus curiae concerning what standards a trial court must apply when approving a PAGA settlement and whether a PAGA plaintiff has standing to appeal in an overlapping class action settlement where his PAGA claims have been released. Alonzo v. First Transit, Inc., B277109 (Cal. App. 2nd Dist., filed Aug. 17, 2016).

One plaintiff, Eric P. Clarke, had launched a PAGA action against a private bus and public transit services company, which, for a variety of reasons, was on hold. The employer was defending another class action brought by a group of drivers and had the complaint amended to add PAGA so that they could release all those claims, too, Reathaford said.

Clarke argued that he was the one who filed PAGA claims first, so the penalties should be his — and a lot higher than the settlement dictated, according Reathaford. The court ruled against the plaintiff, asserting that one class action can settle before another.

The case is now on appeal.

“So the question is, whether this guy, who wasn’t even a party to the case, can even do an appeal,” Reathaford said. “Assuming he could appeal, what standards would apply? Are PAGA standards different from class standards?”

— Lila Seidman