Arias v. Superior Court
A representative action for civil penalties under the Labor Code Private Attorneys General Act need not be brought as a class action, even though a representative claim for the same Labor Code violations under the unfair competition law must satisfy class-action requirements.
Arias v. Superior Court (2009) 46 Cal.4th 969
PAGA
Representative Actions
Class Requirements
Unfair Competition Law
Affirmed
Published
In brief. An employee sued his former employer both under the unfair competition law (UCL) and under the Labor Code Private Attorneys General Act (PAGA), bringing each on behalf of other employees without seeking class certification. The Supreme Court held that the representative UCL claim, after Proposition 64, must satisfy class-action requirements, but that a PAGA representative action for civil penalties need not — and that allowing a non-class PAGA action does not violate the employer’s due-process right to avoid “one-way intervention,” because the PAGA plaintiff sues “as the proxy or agent of the state’s labor law enforcement agencies” and the resulting judgment binds nonparty employees. (Arias v. Superior Court (2009) 46 Cal.4th 969, 985–986.)
Facts
Jose Arias sued his former employer, Angelo Dairy, and others, alleging a series of Labor Code violations — including failures to pay overtime and wages when due and to provide meal and rest periods. (46 Cal.4th at pp. 975–977.) Several causes of action were brought only on his own behalf, but others were asserted on behalf of himself “as well as other current and former employees.” (Id. at p. 976.) Two of those representative counts are central: a UCL claim (Bus. & Prof. Code, § 17200 et seq.) predicated on the underlying Labor Code violations, and a PAGA claim (Lab. Code, § 2698 et seq.) seeking civil penalties. (Id. at pp. 976–977.) Arias did not plead, or attempt to satisfy, the requirements for a class action. (Ibid.) The employer demurred and moved to strike the representative claims on the ground that they could proceed only as class actions. (Id. at p. 977.)
Procedural history
The trial court ruled that the representative claims had to meet class-action requirements. (46 Cal.4th at pp. 976–977.) The Court of Appeal issued a peremptory writ holding that the PAGA claim need not be brought as a class action while the UCL claim must. The Supreme Court granted review and affirmed the Court of Appeal’s judgment in full. (Id. at pp. 975–977, 987.) Decided the same day was the companion case Amalgamated Transit Union, Local 1756 v. Superior Court (2009) 46 Cal.4th 993, which addressed related PAGA standing and assignment questions. (See Arias, supra, 46 Cal.4th at p. 986.)
Issue
Must a private plaintiff who seeks relief on behalf of other employees — under the UCL for Labor Code violations, and under PAGA for civil penalties — bring those representative claims as class actions? And does permitting a non-class PAGA action offend the employer’s due-process right to avoid “one-way intervention”? (46 Cal.4th at pp. 975, 980–987.)
Holding
The Court held “that an employee who, on behalf of himself and other employees, sues an employer under the unfair competition law (Bus. & Prof. Code, § 17200 et seq.) for Labor Code violations must satisfy class action requirements, but that those requirements need not be met when an employee’s representative action against an employer is seeking civil penalties under the Labor Code Private Attorneys General Act of 2004 (Lab. Code, § 2698 et seq.).” (46 Cal.4th at p. 975.) Permitting a non-class PAGA action does not violate the employer’s due-process rights. (Id. at pp. 980–987.)
Reasoning
1. Proposition 64 imposed class requirements on representative UCL claims. Before Proposition 64, a private plaintiff could pursue representative UCL relief on behalf of the general public without class certification. Proposition 64 amended the statute so that a private person may bring such a representative claim “only if the party . . . complies with Section 382 of the Code of Civil Procedure” — the class-action statute. (46 Cal.4th at pp. 970–971, 977–980.) Construing the initiative according to the voters’ intent, the Court found that command unmistakable: representative UCL relief now requires compliance with class-action procedure. (Id. at pp. 977–980.)
2. PAGA contains no such requirement, because it is a law-enforcement action. PAGA, by contrast, authorizes an “aggrieved employee” to bring a representative action for civil penalties “on behalf of himself or herself and other current or former employees,” with no reference to class procedure. (46 Cal.4th at pp. 980–981.) The Court emphasized PAGA’s distinctive nature: an employee who sues under the Act “does so as the proxy or agent of the state’s labor law enforcement agencies,” with the recovery allocated chiefly to the state (75 percent to what is now the Labor and Workforce Development Agency, 25 percent to the aggrieved employees). (Id. at pp. 981, 986.) Because a PAGA action is in substance a qui tam enforcement action brought on the state’s behalf, the Legislature did not condition it on class certification, and the Court would not read such a requirement into the statute. (Id. at pp. 980–986.)
3. No due-process violation from “one-way intervention.” The employer’s principal objection was preclusion. It argued that a non-class PAGA judgment would allow nonparty employees to invoke collateral estoppel if the plaintiff won, while escaping its bite if the plaintiff lost — the unfairness known as “one-way intervention.” (46 Cal.4th at pp. 985–986.) The Court rejected the argument on the ground that, precisely because the PAGA plaintiff acts as the state’s proxy, a judgment in the PAGA action “is binding not only on the named . . . employee but also [on] nonparty aggrieved employees” and the state as to the civil-penalty claim. (Id. at p. 986.) Because nonparty employees would be bound by an adverse penalty judgment, the asymmetry that animates the one-way-intervention doctrine does not arise, and the employer’s due-process rights are not infringed. (Id. at pp. 985–987.) The Court acknowledged that nonparty employees might separately pursue their own individual claims for damages or statutory penalties, but held that residual possibility did not convert the PAGA procedure into a due-process violation. (Id. at p. 987.)
Significance
Arias established the structural feature that defines PAGA litigation in California: the representative PAGA action that proceeds without class certification, justified by PAGA’s character as a state law-enforcement action prosecuted by a private proxy. That feature became the fault line in the arbitration wars — first in Iskanian v. CLS Transportation Los Angeles, LLC (2014) 59 Cal.4th 348, which held PAGA waivers unenforceable in part because a PAGA claim belongs to the state, and later in Viking River Cruises, Inc. v. Moriana (2022) 596 U.S. 639 and Adolph v. Uber Technologies, Inc. (2023) 14 Cal.5th 1104, which addressed how PAGA’s representative structure interacts with the Federal Arbitration Act and with standing. Arias is also the leading authority distinguishing PAGA from the post-Proposition 64 UCL. See the Review’s practice guide on wage-and-hour class actions and PAGA.
Key quotes
“[T]hose requirements need not be met when an employee’s representative action against an employer is seeking civil penalties under the Labor Code Private Attorneys General Act of 2004.” (Arias, supra, 46 Cal.4th at p. 975.)
“[A]n aggrieved employee’s action under the [Act] . . . does so as the proxy or agent of the state’s labor law enforcement agencies.” (Id. at p. 986.)
Practice pointer
Plead PAGA and UCL representative claims differently. A representative PAGA claim for civil penalties does not require class allegations or certification — do not burden it with them, and resist any demurrer or motion to strike that demands them. A representative UCL claim for the same Labor Code violations does require compliance with Code of Civil Procedure section 382, so either plead it as a class claim or confine the UCL count to the named plaintiff’s individual restitution. Keeping the PAGA claim free-standing also preserves its strategic value after Iskanian and Adolph, where the representative PAGA action survives even when individual claims are compelled to arbitration. And cite Arias’s proxy/qui tam characterization whenever the defense tries to recharacterize a PAGA claim as an aggregation of private claims subject to class or arbitration limits.
Open questions
Arias settled that PAGA needs no class certification but left open how a representative PAGA action is to be tried manageably — a question that Duran v. U.S. Bank National Assn. (2014) 59 Cal.4th 1 later framed for class actions and that trial courts continue to confront in large PAGA cases. The Supreme Court returned to PAGA manageability in Estrada v. Royalty Carpet Mills, Inc. (2024) 15 Cal.5th 263, holding that courts lack inherent authority to strike a PAGA claim as unmanageable, leaving the practical trial of sprawling representative actions an unresolved and pressing problem.
See also: Turrieta v. Lyft · Amalgamated Transit Union Local 1756 v. Superior Court