Employment Counseling and Disputes

In most cases there is no agency proceeding to respond to. An employee alleging a FEHA violation typically requests an immediate right-to-sue notice from the Civil Rights Department (the agency formerly known as the DFEH) and proceeds straight to court; the right-to-sue letter is the administrative exhaustion prerequisite and starts the one-year window to file suit. So the employer's task is litigation readiness, not crafting an agency response.

Two steps matter most on notice of a claim. First, preserve evidence. Once litigation is reasonably anticipated, the employer should institute a litigation hold over relevant records – personnel files, performance documentation, emails and text messages, timekeeping and scheduling data, and information about comparators – because destruction of such material can expose the employer to spoliation sanctions. Second, where the underlying allegation involves harassment or discrimination, a prompt, impartial, and adequately documented workplace investigation is both part of the employer's FEHA obligation to take reasonable steps to prevent and correct unlawful conduct and a meaningful component of the defense. Counsel should be involved early to manage privilege and to ensure no contact with the complainant could be characterized as retaliation, which is an independent and often more dangerous claim than the underlying allegation.

The recurring exposure areas are meal and rest period compliance and the associated premium pay, off-the-clock work, misclassification (both exempt versus non-exempt and employee versus independent contractor under the ABC test codified at Labor Code section 2775), the accuracy of wage statements under section 226, timely payment of final wages and the resulting waiting-time penalties under section 203, and reimbursement of business expenses under section 2802. These claims aggregate, which is what makes them significant; individual recoveries are often modest, but the same practice applied across a workforce produces substantial cumulative liability.

They are distinct vehicles with different mechanics. A class action seeks damages on behalf of similarly situated employees and requires class certification. The plaintiff must show common questions predominate, and that the representative and counsel adequately represent an ascertainable class, and recovery flows to the class members. A PAGA claim is a representative enforcement action in which the employee sues as a proxy for the state to recover civil penalties for Labor Code violations; it requires no class certification, and the penalties are split between the state and the affected employees.

The 2024 reforms (AB 2288 and SB 92), which apply to claims with notices filed on or after June 19, 2024, reshaped PAGA in ways that matter to employers. Standing now requires the plaintiff to have personally experienced each violation alleged, curbing the prior practice of asserting Labor Code violations the plaintiff never suffered. The reforms cap penalties for employers who took all reasonable steps to comply before receiving notice, and reduce them further for employers who cure after notice, while expanding the cure mechanism and adding early evaluation procedures. The employee share of penalties rose to thirty-five percent, and injunctive relief is now expressly available. PAGA remains a major source of exposure, but documented compliance efforts and prompt cure now have real value in reducing penalties.

A feature that cuts across these claims is fee-shifting: most California wage statutes, and FEHA, allow a prevailing employee to recover attorney's fees, frequently on a one-way basis where the employer cannot recover its own fees even if it prevails. This asymmetry is a major driver of litigation and settlement dynamics, independent of whether a claim is brought individually, as a class action, or under PAGA.