Under California’s Private Attorneys General Act, the default civil penalty is $100 per aggrieved employee per pay period, with a lower $25 or $50 tier for minor or isolated problems and a $200 tier for repeat or malicious conduct. PAGA penalties in California can also be capped at 15 or 30 percent of the ordinary amount when an employer shows it was taking reasonable compliance steps, and specific violations can be cured to eliminate the penalty altogether. These rules apply to notices filed on or after June 19, 2024, when the reformed statute took effect.
The Four Penalty Tiers
When the Labor Code itself doesn’t set a civil penalty for a given violation, PAGA supplies one. The amount depends on the nature of the violation and the employer’s history.1California Legislative Information. California Labor Code 2699
- $25 per employee per pay period for most wage statement errors under Section 226(a) when the employee could reasonably determine the correct information from the statement, and for employer name or address errors on pay stubs when the employee wouldn’t actually be confused about who the employer is.
- $50 per employee per pay period when the violation came from an isolated, nonrecurring event lasting no more than 30 consecutive days or four consecutive pay periods, whichever is shorter.
- $100 per employee per pay period as the standard figure for violations that don’t fit a lower or higher tier.
- $200 per employee per pay period when the employer received a formal finding within the prior five years that the same policy or practice was unlawful, or when a court finds the conduct was malicious, fraudulent, or oppressive.
Employers who pay their workforce weekly instead of biweekly or semimonthly see the penalty cut in half, so a more frequent pay schedule doesn’t become its own source of liability. If the violator had no employees at the time of the violation, a flat $500 penalty applies and the entire amount goes to the state.
Because these amounts accrue per employee and per pay period, exposure can grow quickly. A company with 200 workers and two years of noncompliant pay stubs can face a seven-figure claim before any enhancement, which is why the tier an employer lands in matters so much.
How the Penalty Can Be Reduced
The 2024 reforms built in several ways to shrink the number. Each turns on timing and on what the employer did before the dispute reached court.1California Legislative Information. California Labor Code 2699
- A 15 percent cap applies when the employer was already taking all reasonable steps to comply before receiving the PAGA notice or a records request. The court can award no more than 15 percent of what the penalty would otherwise be.
- A 30 percent cap applies when the employer wasn’t compliant beforehand but takes all reasonable steps within 60 days after receiving the notice.
- A $15 per employee per pay period cap applies to a violation the employer successfully cures but without being able to show it took all reasonable steps.
What counts as “reasonable steps” is judged on the totality of circumstances, including the employer’s size and resources and the nature and duration of the violations. The statute points to periodic payroll audits with follow-up action, written policies, supervisor training on wage-and-hour compliance, and corrective action when supervisors fall short. A violation can still occur despite these efforts without automatically defeating the defense.
Two situations stay outside the caps. The 15 and 30 percent reductions don’t apply to the $200 enhanced penalty for malicious, fraudulent, or oppressive conduct, and they don’t apply where the employer was previously told the same practice was unlawful. Those penalties remain uncapped.
How Recovered Penalties Are Split
For notices filed on or after June 19, 2024, 65 percent of the recovered penalty goes to the Labor and Workforce Development Agency and 35 percent goes to the aggrieved employees.1California Legislative Information. California Labor Code 2699 Cases built on notices filed before that date follow the older 75/25 split favoring the agency.2Labor and Workforce Development Agency. Private Attorneys General Act (PAGA) Frequently Asked Questions
The $500 flat penalty assessed when the violator employed no one is the exception. All of it goes to the LWDA. Attorney’s fees and litigation costs are awarded separately from the penalty total, so the employees’ share isn’t reduced by the cost of pursuing the case.
Who Can Bring a Claim
Only an “aggrieved employee” can file a PAGA action, meaning someone who was employed by the alleged violator and against whom the violations were committed. For notices filed on or after June 19, 2024, the plaintiff must have personally experienced each Labor Code violation alleged in the lawsuit, not just one of them.2Labor and Workforce Development Agency. Private Attorneys General Act (PAGA) Frequently Asked Questions That is a tighter standard than the old rule, which let a single violation open the door to every related claim in the workplace.
A narrow exception exists for employees represented by a nonprofit legal services organization that has litigated PAGA cases for at least five years before January 1, 2025. Those plaintiffs need to have experienced at least one of the alleged violations rather than all of them.
Before suing, the employee must file written notice with the LWDA through its online portal and send the employer notice by certified mail. The online filing carries a $75 fee that can be waived for financial hardship. The notice has to identify the specific Labor Code sections at issue along with the facts and theories behind each claim; whatever gets left out generally can’t be added to the lawsuit later. California courts have strictly enforced a one-year limitations period for filing the LWDA notice.
Cures That Erase or Shrink the Penalty
The reformed statute created structured ways for employers to fix violations and avoid penalties, which also tells an employee what the final recovery might look like.
Small Employer Administrative Cure
Employers with fewer than 100 total employees in the year before the PAGA notice can seek an administrative cure through the LWDA. The headcount includes exempt, nonexempt, temporary, seasonal, current, and former workers, whether or not they work in California.3Labor and Workforce Development Agency. LWDA PAGA Cure Procedures
The employer submits a confidential cure proposal to the LWDA within 33 days of receiving the notice, with a $75 filing fee. The agency has 14 days to review and decide whether to schedule a conference, which if held takes place within 30 days of the scheduling notice. If the LWDA issues a cure plan, the employer has 45 days from the conference to complete the corrective actions and submit a sworn notice of completion. The LWDA then has up to 20 days to confirm whether the cure is complete.
Wage Statement Cure for Any Employer
Any employer, regardless of size, can use a streamlined cure when the only alleged violation is wage statement itemization under Section 226. The employer has to notify both the LWDA and the employee and complete all cure steps within 33 days of the PAGA notice postmark date.2Labor and Workforce Development Agency. Private Attorneys General Act (PAGA) Frequently Asked Questions For errors in most wage statement categories (paragraphs 1 through 7 and 9 of Section 226(a)), the cure means providing a fully compliant itemized wage statement for each affected pay period. For employer identification errors in paragraph 8, written notice of the correct information is enough.4California Legislative Information. AB 2288 Labor Code Private Attorneys General Act of 2004
A successful cure eliminates the civil penalty for that violation entirely. If the employer cures but can’t show it took all reasonable steps, the penalty drops to $15 per employee per pay period. For unpaid wage violations, “made whole” means the employer pays the owed wages going back three years from the notice date, plus 7 percent interest, any required liquidated damages, and reasonable attorney’s fees and costs.
Beyond Money: Injunctive Relief
PAGA used to produce only civil penalties. Under the reformed statute, courts can also order injunctive relief, requiring an employer to change specific workplace practices going forward instead of only paying for what already happened.1California Legislative Information. California Labor Code 2699 For workers still at the company, an order fixing the underlying practice can matter more than a share of the penalty.