On December 15, 2021, the U.S. Supreme Court granted certiorari in Viking River Cruises, Inc. v. Moriana. At issue in this case is whether a California employer may enter into a voluntary agreement with an employee whereby the employee agrees to only bring his or her individual claims in an arbitration proceeding and not bring any class or representative claim under California’s Private Attorneys General Act (PAGA). The U.S. Supreme Court will likely issue a decision in the summer of 2022. Here is an overview of the key issues in Viking River Cruises, Inc. v. Moriana, California employers need to understand:

California’s Private Attorneys General Act (PAGA)

PAGA was designed by the California Legislature offer financial incentives to private individuals to enforce state labor laws by recovering certain civil penalties. Aggrieved employees can seek recovery of civil penalties for Labor Code violations they suffered, in addition to penalties for all Labor Code violations by the employer in a representative action, as long as the employee suffered by at least one violation. PAGA permits the aggrieved employees to collect civil penalties for Labor Code violations previously recoverable only by the Labor Commissioner. If the Labor Code does not provide for a penalty, PAGA sets them at $100 per employee per pay period for the first violation, and $200 per pay period per employee for a subsequent violation. 75% of the collected penalties must be distributed to the Labor and...

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