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The 2024 PAGA amendments created more opportunities for California employers to correct violations and resolve claims before litigation becomes prolonged or expensive. The California Labor and Workforce Development Agency (LWDA) has proposed new regulations that would give those procedures more structure while adding requirements that would likely complicate settlement. Following a hearing in April and public comment period, the LWDA modified the proposed rules on August 3, 2026.
For California employers, three areas warrant focus: settlement procedures, notice requirements, and the administrative cure process for small employers.
Settlement
It is frequently beneficial to employers to amend a PAGA notice post-settlement to avoid piecemeal litigation and resolve overlapping PAGA claims in one fell swoop. While the proposed regulations do not outright ban this practice, they create additional hurdles to amending a PAGA notice that will likely still result in increased litigation and expenses. The proposed regulations would prohibit claimants from amending a PAGA notice after the parties have reached a proposed settlement unless the amended notice includes detailed information and statements regarding the new allegations and their factual bases.
The regulations would also require a settling plaintiff to submit additional materials to the LWDA along with a proposed settlement agreement and give the LWDA at least 45 days to review them. They also require that a plaintiff, utilizing the PAGA Case Search Web Site, provide notice via email of the proposed settlement to any other plaintiffs who have pending PAGA claims against the same employer. If enacted, these additional procedural requirements will add time to the settlements of PAGA claims, and settlements will also draw more scrutiny.
Notice
The proposed regulations seek to discourage frivolous filings through more detailed notice requirements for “high-frequency” and “non-compliant filers”:
- “High-frequency filers” – defined as an attorney who has filed 100 or more, or a law firm that has filed 200 or more, PAGA notices in the preceding 12-month period – must include a cover letter stating that they are a “high-frequency filer” as well as a certification that the PAGA notice is not filed for an “improper purpose” along with each PAGA notice they submit.
- “Non-compliant filers” are attorneys or law firms that have filed three or more noncompliant PAGA notices within the preceding 12 months despite previous warnings from the LWDA. The regulations enable the LWDA to conduct pre-filing screening of any PAGA notices submitted by non-compliant filers.
Notably for employers, the regulations also provide an opportunity for the employer to respond to a PAGA notice within 33 days of receipt of the notice. Under section 17421, an employer may, but is not required to, respond to violations it disputes and provide the bases for such disputes as well as any supporting evidence. As such, this regulation would provide employers with an early opportunity to put the LWDA on notice and build a record of conclusory PAGA allegations and claims.
Administrative Cure for Small Employers
The proposed regulations provide a framework to utilize the 2024 PAGA amendments’ pre-litigation cure process for small employers with fewer than 100 employees:
- The small employer has 33 days to submit a confidential cure proposal to the LWDA after receiving a PAGA notice. That proposal must identify the violations the employer proposes to cure and specifically describe how it will do so.
- The LWDA then has 14 days to review the proposal and decide whether to schedule a cure conference, which is a newly-created meeting between the parties and the LWDA, intended to “ascertain the requirements of a sufficient cure for the violations at issue based on the information provided by the parties.” Section 17434.
- If a cure conference is held and a cure plan is reached, the employer has 45 days to complete the cure and submit a sworn statement to the LWDA to that effect.
The regulations also provide that an employer’s cure proposal is considered a confidential settlement communication and cannot later be construed as an admission of liability. Further, the employee cannot file a lawsuit against the employer while the cure process is pending. Therefore, if enacted, these regulations would provide a genuine mechanism for small employers to avoid PAGA litigation through quick, corrective action.
Finally, the regulations confirm that, if they are enacted, they will apply only to matters or cases pending at or filed after the regulations’ effective date. They will not apply retroactively.
While the regulations are not yet final, the LWDA appears to be pursuing these regulations in earnest, and they are likely to be enacted in the months to come. Employers can prepare now by establishing how notices are escalated, records are preserved, and allegations are investigated. Those findings should inform both the litigation strategy and the operational changes needed to reduce recurring risk.