A new California law that took effect January 1, 2004, will make it easier for employees to sue businesses over certain employment matters. Under Senate Bill 796 (SB 796), California employees now have the right to take employers to court over Labor Code violations such as safety, working conditions, overtime pay, and wages. Employees have long been able to sue over issues like sexual or racial discrimination and wrongful termination. The measure was supported by state labor groups.

The law, which, not surprisingly, was opposed by many business and employer groups, is titled The Labor Code Private Attorneys General Act of 2004. It states that actions may be brought for any violation of the Labor Code that provides for a civil penalty through the state's Labor and Workforce Development Agency, or any of its subdivisions. One of the complaints expressed by business groups is that the law refers to "aggrieved employees," and does not require that an actual injury be involved, they say.

The business community is also concerned about potentially catastrophic damages for violations. The calculation described in the bill is based on the number of aggrieved employees, times the number of pay periods during which the violation occurred, times the fine provided in the law, plus attorney's fees and costs. Half the fine goes into the state's general fund, a quarter goes to the employee who filed the lawsuit, and a quarter is paid into a labor education fund.

SB 796 includes language explaining that it is not intended to change state workers' compensation provisions.