PAGA after the 2024 reform: penalties, caps, cure and notice rules for plaintiff counsel

The Private Attorneys General Act (PAGA) was rewritten in July 2024 by two bills signed together, AB 2288 and SB 92. The deal kept the private right of action and changed almost everything around it: who can sue, how penalties are counted, how much an employer can cut them, and how an employer can cure before suit. This guide sets out the current rules for plaintiff counsel, with the section that says each one. It is general information, not legal advice; check the current text of Labor Code 2699 and 2699.3 before you calculate exposure on a live case.

What changed, and which cases it covers

The amendments apply to civil actions brought on or after June 19, 2024. They do not apply to a case whose PAGA notice was filed with the LWDA before June 19, 2024 (Labor Code 2699(v)). Those cases stay under the old law. The current version of the notice and cure section, Labor Code 2699.3, became operative October 1, 2024, when the LWDA's cure process started.

The main changes:

• The penalty split moved from 75/25 to 65/35.
• The old "initial" and "subsequent" violation penalties are gone. The default is $100, with $200 only in two situations.
• Employers that took "all reasonable steps" to comply get their penalties capped at 15 or 30 percent.
• Employers can cure many violations, through the LWDA for smaller employers or an early evaluation conference in court for larger ones.
• The plaintiff must have personally suffered each violation alleged.
• Courts can award injunctive relief and can limit the scope of claims so they can be tried.

Penalties after the reform

Penalties are split 65 percent to the LWDA and 35 percent to the aggrieved employees (Labor Code 2699(m)).

The reform also stops some stacking. There is no PAGA penalty for late final pay under Labor Code 201 to 203, for Labor Code 204 unless willful or intentional, or for Labor Code 226 unless knowing or intentional, on top of the penalty for the underlying unpaid wage (Labor Code 2699(i)). Notice and posting violations are out entirely, except mandatory payroll or workplace injury reporting (2699(k)(2)).

Caps for employers that took reasonable steps

These caps are where most negotiation now happens.

• 15 percent cap. If, before it received the PAGA notice or a records request, the employer took all reasonable steps to comply with the provisions in the notice, penalties cannot exceed 15 percent of what is sought (Labor Code 2699(g)(1)).
• 30 percent cap. If the employer took all reasonable steps within 60 days after receiving the notice, the cap is 30 percent (Labor Code 2699(h)(1)).
• What counts. Reasonable steps "may include" periodic payroll audits with action on the results, lawful written policies, supervisor training and corrective action with supervisors. Courts judge them on the totality of the circumstances, including the employer's size and resources and the nature, severity and duration of the violations. A violation that happened anyway does not by itself prove the steps were not reasonable (2699(g)(2)).
• No cap on $200 penalties (2699(g)(3) and (h)(3)). Courts may also award less than the maximum, or exceed the caps, where a different result would be unjust, arbitrary and oppressive, or confiscatory (2699(e)(2)).

For plaintiff counsel this means discovery on the employer's compliance program starts early. Ask for audit records, policy versions with dates, training logs and supervisor discipline, and note when each one started.

The notice: what it must say and what it costs

The case starts with an LWDA notice, filed online with the LWDA and sent by certified mail to the employer (Labor Code 2699.3). The filing fee is $75, waivable for those who qualify, and an employer response costs the same.

The notice must give "the specific provisions of this code alleged to have been violated, including the facts and theories to support the alleged violation." The LWDA's FAQ says that reciting or rephrasing the statute is not enough. Write each violation with its facts: the job, the practice, the time period, and how it affected the client.

The LWDA has 60 days to say whether it will investigate. If it does not respond within 65 calendar days of the notice's postmark, or says it will not investigate, the employee may file suit. The LWDA has proposed regulations that would add notice content requirements, including counsel's contact and State Bar details. As of this review they are proposed, not adopted.

Cure: three tracks

• Employers with fewer than 100 employees. Within 33 days of receiving the notice, the employer may submit a confidential proposal to cure. The LWDA may set a conference and require security for the wages, liquidated damages and 7 percent interest at stake. The cure must be finished by the agreed date, and the employee can challenge it at a hearing (Labor Code 2699.3(c)(2)).
• Wage statement violations, any employer. The employer can cure a Labor Code 226(a) violation within 33 days of the notice's postmark, with an LWDA ruling if the employee disputes it (2699.3(c)(3)).
• Employers with 100 or more employees. At or before its first responsive pleading, the employer may ask the court for an early evaluation conference and a stay. The employer files a cure plan, the plaintiff responds, and a neutral evaluates it (2699.3(f)).

A cure means correcting the violation and making each aggrieved employee whole: unpaid wages going back three years from the notice, 7 percent interest, any statutory liquidated damages, and reasonable lodestar attorney's fees and costs (Labor Code 2699(d)(1)). An employer can use notice-and-cure only once in 12 months for the same provisions.

Not every violation can be cured through the LWDA. Labor Code 2699.5 lists provisions, including Labor Code 201 to 204 and 1102.5, that follow the notice process without a cure step. Overtime, meal and rest periods, minimum wage, expense reimbursement and wage statements are among those that can be cured.

Standing, limitations and the case law that still matters

An aggrieved employee must have been employed by the employer and "personally suffered each of the violations alleged" within the limitations period (Labor Code 2699(c)(1)). Plead only what the client lived through, and check each violation against the client's dates.

The limitations period is one year for statutory penalties (CCP 340(a)), and the time the notice process takes is not counted against it (Labor Code 2699.3(e)). File the notice early: every pay period you wait is one fewer in the penalty period.

Two Supreme Court decisions still frame the practice. Adolph v. Uber Technologies, Inc. (2023) 14 Cal.5th 1104 held that an order compelling arbitration of a plaintiff's individual claims does not strip standing to pursue the non-individual claims in court. Estrada v. Royalty Carpet Mills, Inc. (2024) 15 Cal.5th 582 held that trial courts lack inherent authority to strike PAGA claims as unmanageable; the reform now lets courts limit the evidence and scope of a claim so it can be tried (Labor Code 2699(p)). The Supreme Court also granted review in Leeper v. Shipt on whether every PAGA action must include an individual claim. As of this review it has not been decided.

A PAGA intake checklist

1. Client's employment dates, pay frequency (weekly halves the penalty) and last pay period in the one-year window.
2. Each violation the client personally suffered, with dates and documents.
3. Employer headcount, to know which cure track applies.
4. Any arbitration agreement, for the Adolph analysis.
5. Records requests under Labor Code 226 and 1198.5, sent early.
6. Evidence on the employer's compliance program, for the reasonable-steps caps.
7. The notice filing date, the 65-day date and the one-year date, on the calendar.

Our PAGA penalty calculator runs the post-reform math with the split and the caps.

Tracking PAGA work in PlaintiffStack

In PlaintiffStack's employment practice, the wage and penalty audit reads searchable pay records and proposes back pay, penalties and pay anomalies, each tied to the page it came from, for a person to accept. It does not read scanned records; there is no OCR yet. The notice date and suit date sit on the case with their basis, and tasks put a name on each step. The results feed the Damages page and a pre-litigation demand draft that waits for review before anything is sent.