In the first ruling of its kind, the California Court of Appeal (4^th Dist.) recently ruled that a plaintiff may pursue penalties under the Private Attorneys General Act (PAGA) for alleged violations of California’s sick pay statute, the Healthy Workplaces, Healthy Families Act of 2014.  Wood v. Kaiser Found. Hosps., 2023 WL 2198664 (Cal. Ct. App. Feb. 24, 2023).

At issue was the meaning of Labor Code Section 248.5(e), which provides that “any person or entity enforcing this article on behalf of the public as provided for under applicable state law shall, upon prevailing, be entitled only to equitable, injunctive, or restitutionary relief[.]”  As the Court conceded, every federal district court to consider the issue had held that this provision precluded the recovery of PAGA penalties, because a PAGA plaintiff seeking to enforce the Act does so “on behalf of the public as provided for under applicable state law.”  Wood, 2023 WL 2198664, at *11.

However, Wood broke with this consensus primarily by parsing the legislative history of the Act.  Describing its role as “that of a detective,” seeking to “uncover what [the Legislature] had in mind,” it embarked on a thorough analysis comparing earlier versions of the bill to the version enacted.  Id. at *3-9.  Its conclusion was that the limitation on remedies was intended to apply only to claims under the Unfair Competition Law (UCL).

It is not hard to imagine this defendant or another employer challenging this reasoning in the California Supreme Court or another Court of Appeal, because there may be a persuasive argument that Wood’s legislative history analysis was unnecessary.  Notably, the statute does not mention the UCL at all.  Rather, it broadly refers to enforcement actions bought “on behalf of the public as provided for under applicable state law.”  Cal. Lab. Code § 248.5(e).  District courts have unanimously concluded that this language unambiguously encompasses PAGA actions.  E.g., Rudolph v. Herc Rentals, Inc., 2021 WL 5994514, at *5-6 (C.D. Cal. Aug. 27, 2021) (explaining that the “key language is clear in its context”).  If the meaning of the text is plain, then there is no opportunity for a court to assume the role of “detective” and dig through the legislative history for a contrary intent.

In the meantime, however, Wood’s holding is binding on California trial courts: a plaintiff may seek PAGA penalties for alleged violations of the sick pay statute.