Supreme Court Approves Early Discovery of Employee Information in Class Action and PAGA Lawsuits

Erick J. Becker

Erick J. Becker

Class action and Private Attorneys General Act (PAGA) lawsuits for alleged wage and hour violations continue to proliferate. Plaintiff’s counsel typically seeks information on all the company’s hourly employees (including personal addresses and phone numbers) throughout the state immediately after filing the lawsuit, and employers have typically resisted based on arguments that the requests are overbroad and invade employee privacy. An employer’s ability to fend off such early discovery requests was bolstered by the 2015 California appeals court decision in Williams v. Superior Court, which held that a plaintiff first had to demonstrate his or her own claims had some validity before gaining access to information about other employees.

The California Supreme Court, however, issued a decision on July 13 overruling the lower court and holding that plaintiff does not need to establish any merit to his or her claims before obtaining information about other employees. The court validated previous rulings that privacy concerns are a legitimate basis for objecting to discovery requests, but that such concerns can be alleviated by giving employees notice and an opportunity to “opt out” of having their information sent to plaintiff’s counsel (known as a “Belaire” notice).

As a result of the court’s decision, employers facing class action or PAGA lawsuits will in most cases have to agree to a Bel-Aire notice and turn over voluminous information about all employees early in the litigation. This ruling will no doubt fuel the continuing expansion of wage and hour litigation in California, targeting even the smallest businesses. Employers of any size should therefore regularly audit their policies and practices to make sure they are fully compliant with the relevant wage orders and Labor Code sections, particularly when it comes to overtime pay (especially including bonuses and other compensation when calculating overtime) and meal and rest periods.