California Supreme Court To Clarify Plaintiffs' Standing To Pursue PAGA Claims Following Settlement Of Individual Claims
April 4, 2018Kim v. Reins International California
S246911 — Review Granted — March 28, 2018
California’s Private Attorneys General Act (PAGA) permits an aggrieved employee to bring a representative action on behalf of current or former employees to recover civil penalties for wage-related violations of California’s Labor Code.
In Kim v. Reins International California, Inc. (2017) 18 Cal.App.5th 1052, a plaintiff filed a wage-and-hour class action against his former employer, alleging both individual and class claims. He also sought civil penalties for aggrieved employees under PAGA. The trial court compelled the plaintiff to arbitrate his individual claims, reserved for the arbitrator the question of whether the plaintiff could proceed with class arbitration, and stayed the PAGA claim pending arbitration.
While arbitration was pending, the plaintiff accepted an offer to compromise, and dismissed his individual claims with prejudice. The Court of Appeal held that, by accepting the settlement and dismissing his individual claims with prejudice, the plaintiff “essentially acknowledged that he no longer maintained any viable Labor Code-based claims against” the employer and therefore lacked standing to maintain a PAGA action as an “aggrieved employee.”
The California Supreme Court has granted review.