The Road To PAGA Reform FROM CHALLENGE TO TRIUMPH By Autumn Heacox, Director of Communications & Marketing, CNCDA Running a successful car dealership in California has always been about more than just selling cars; it’s about building a business that supports employees, contributes to the local community and thrives in a competitive market. However, this goal has become increasingly challenging over the past decade as California business (and dealership) owners found themselves ensnared in the web of the Private Attorneys General Act (PAGA). PAGA was enacted in 2003 by then‑recalled Gov. Gray Davis in his last few days in office. The law was initially intended to help employees enforce labor laws by allowing them to sue their employers on behalf of the state. While its original intentions may have been noble, the reality of PAGA’s implementation was far from practical. Over the years, it became clear that a few trial attorneys caught on to PAGA loopholes, allowing them to exploit the law for personal gain by filing lawsuits on behalf of employees for minor or technical violations that had little to do with their well-being. These PAGA lawsuits imposed staggering (and sometimes devastating) penalties on California businesses and nonprofits, often forcing them to pay millions of dollars to settle the suits — even when violations were as minor as a clerical error on a pay stub. Most settlements went to the attorneys, with employees receiving only a fraction of the total payout. 12 California New Car Dealer Quarterly
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