United States: California Trial Courts Continue To Interpret Johnson v. Maxim Healthcare Narrowly When Applying PAGA's One-Year Statute Of Limitations

Last year, the California Court of Appeal raised eyebrows by ruling that a plaintiff could pursue a Private Attorneys General Act (PAGA) claim for alleged violations of Labor Code Section 432.5, even though the statute of limitations on her individual claim had run. Johnson v. Maxim Healthcare Servs., Inc., 66 Cal. App. 5th 924 (2021). Some plaintiffs' lawyers argued that this ruling meant that any employee who ever experienced a Labor Code violation could bring a PAGA claim on behalf of other aggrieved employees, even if the plaintiff was not even employed by the defendant during the limitations period. However, early decisions applying the Johnson decision endorsed a narrower interpretation: a PAGA plaintiff must still have experienced a violation during the limitations period, regardless of whether the plaintiff could bring an individual claim for that violation in their own right. (To read about these decisions, click here.)

Approximately one year after the Johnson decision, more trial courts have pointed to the narrow interpretation by holding that a plaintiff must have experienced a violation during period relevant to the PAGA claim in order to have standing. In Rodriguez v. Bodega Latina Corp., No. 21 CMCV00260 (L.A. Super. Ct. Jan. 18, 2022), the limitations period on the plaintiff's PAGA claim dated back to July 31, 2020, but a prior settlement barred the plaintiff's claims through June 25, 2021. The court held that because the plaintiff's employment ended in November 2020, he had no standing because he was not an employee during the only period relevant to his claims, in light of the prior settlement.

Similarly, in Prudential Overall Wage & Hour Cases, No. RICJCCP5046 (Riverside Super. Ct. Mar. 7, 2022), the court tentatively ruled that a plaintiff whose employment ended before the limitations period had no standing to pursue PAGA claims, and rejected the plaintiff's reliance on Johnson to argue otherwise. (The case settled before a final order was issued.) And in Tran v. MM Enters. USA, LLC, No. 21STCV32456 (L.A. Super. Ct. Aug. 8, 2022), the court reached the same result, collecting a wealth of authorities (including from the California Court of Appeal) holding that a plaintiff may not seek PAGA penalties for a period that entirely postdates their employment.

In sum, a growing consensus of trial courts is rejecting the maximal interpretation of Johnson espoused by the plaintiffs' bar. Instead, PAGA's one-year statute of limitations continues to apply with equal force. Employers can probably rest assured that courts will not permit plaintiffs to come out of the woodwork and assert PAGA claims long after their separation.

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