While the California State Legislature has recessed for the rest of the year, we have an opportunity to step back and evaluate what our priorities as a state and community should be.
As a small business owner, there is nothing more important to me than reforming state law to create a better climate for small businesses to grow and create more jobs. The more jobs we create, the more competitive the labor market is, and the higher wages will be. In particular, there are two critical issues that the Legislature could, and should, address:
PAGA — The Private Attorney General Act was passed in 2004, and essentially deputized private lawyers to sue employers for millions of dollars in penalties for technical violations of the California Labor Code. In essence, the measure gave the authority of state prosecutors over to private trial attorneys who could use their new authority to make millions off of shakedown lawsuits, and over the last 18 years, that is exactly what has happened. It is incalculable how many jobs we could have seen created in California if businesses didn’t have to spend millions on defense and settlements related to PAGA.
ADA — Similar to PAGA, the Americans with Disabilities Act, while well intentioned, has been a gold mine for abusive trial attorneys to take advantage of for personal gain. Attorneys identify small, trivial issues in violation of the ADA and use the violation to extort settlements out of the business owner. There is no opportunity for the business owner to remedy an alleged issue before the attorney demands a settlement.
Solving these two issues, PAGA and ADA related lawsuit abuse, would create thousands of jobs and grow our economy. When legislators return to Sacramento next year, I hope these are top priorities.