California Labor Code 2698 is the first section of the Private Attorney General Act (PAGA). Employees denied their labor rights can bring PAGA claims against their employers in pursuit of civil penalties. These civil penalties typically amount to $100 for initial violations and $200 for subsequent violations. However, employees receive only 25% of these penalties; the rest go to the state.
The full text of the statute reads as follows:
2698. This part shall be known and may be cited as the Labor Code Private Attorneys General Act of 2004.
Legal Analysis
California Labor Code 2698 marks the first section of PAGA, which spans Part 13 of Division 2 of the California Labor Code. Employees can sue their employers under PAGA for labor code violations, such as:
- Receiving less than minimum wage;
- Not getting any required meal breaks;
- Not receiving overtime pay; and/or
- Working in a dangerous environment not up to code.1
Employers who lose PAGA lawsuits must pay civil penalties. A first-time violation is $100 per employee, per pay period. And any successive violations are $200 per employee, per pay period. Most of these penalties (75%) go to the Labor and Workforce Development Agency. The remaining 25% goes to the employees in the PAGA lawsuit.2
Since PAGA lawsuits do not compensate aggrieved employees for unpaid wages, they would also need to bring a wage and hour lawsuit against the employer in an attempt to get back pay. But depending on the terms of their employment contract, aggrieved employees may have to settle all wage and hour disputes through arbitration instead of a traditional lawsuit.3
Legal References
- California Labor Code 2698 – Citation of part. Dunlap v. Superior Court (Cal. App. 2d Dist., 2006), 142 Cal. App. 4th 330, 47 Cal. Rptr. 3d 614. See also California Labor Code 2699.
- California Labor Code 2698. Kim v. Reins Internat. California, Inc. (Cal. App. 2d Dist., 2017), 227 Cal. Rptr. 3d 375, 18 Cal. App. 5th 1052.