For California’s franchised car dealerships, this was more than just a legal issue; it was an existential threat. The financial burden of these lawsuits was crippling, putting over 130,000 California dealership jobs at risk and threatening the very survival of franchised dealerships that have been, in many cases, cornerstones of their communities for generations. Recognizing the seriousness of the problem, the California New Car Dealers Association (CNCDA) knew it was our responsibility to take action for our members. The journey to PAGA reform was not an easy one. Additionally, the inherently problematic nature of PAGA lawsuits is that providing explanations to adequately inform the public (and, in turn, legislators) required sharing real-life examples, thus potentially painting a target on business owners’ backs (even when the lawsuits were baseless). However, as the number of lawsuits grew, it became clear that too many businesses were devastated by these cases, and our dealers were not alone in their plight. CNCDA began its fight against PAGA roughly six years ago, initially focusing on raising awareness among its members and gathering the necessary funds to challenge the law. This was no small task. Rallying support for a cause as complex and multifaceted as PAGA reform required tremendous effort and perseverance. Some members initially hesitated to contribute, uncertain about the chances of success or the potential backlash from the public. However, the CNCDA Board of Directors pressed on, and as the lawsuits piled up, more and more members recognized the necessity of change. The association realized that to bring about meaningful reform, we would need to qualify the issue on the upcoming general election ballot and bring the issue to California voters to weigh in. When CNCDA started PAGA reform efforts in 2018, the expectation was qualifying and running a ballot measure in 2022. Unfortunately, research and drafting pushed our efforts into late 2021, and COVID-19 unavoidably extended the time needed for the 700,000 valid signatures required for qualification. In the spring of 2022, the coalition pushed qualification to the 2024 general election to ensure we obtained the requisite number of signatures. This is when our collective dealership body rallied together and raised the funds to get the signatures needed to place PAGA reform on the ballot. In late 2023, the association realized that to better secure a reform victory, we would need to adopt a dual-track approach: simultaneously working towards campaigning for the ballot measure while also engaging in a new strategic public affairs campaign with a coalition of other California business groups to encourage legislators toward enacting reform directly. “Our dealers stepped up in an unprecedented way, demonstrating the power of collective action and the importance of standing up for what’s right. They pulled out their checkbooks and took action to ensure the measure qualified for the ballot. This initial fundraising campaign was a testament to their dedication and unwavering support for our efforts.” — Brian Maas, President CNCDA 13 California New Car Dealer Quarterly
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