PAGA Penalties May Be Reduced Per Employee, Not Per Pay Period

Court

Cal. Ct. App., 4th Dist.

Decided

May 26, 2026

Case No.

G064718

In Taduran v. James R. Glidewell, Dental Ceramics, Inc., the Fourth District Court of Appeal held that a trial court reducing PAGA civil penalties is not required to apply the reduction on a per-pay-period basis⁠—⁠it may reduce the maximum on a per-employee basis instead. The court also affirmed a negative multiplier that reduced the plaintiff’s fee award. The opinion was certified for publication on June 17, 2026.

Background

Abraham Taduran sued his former employer, James R. Glidewell, Dental Ceramics, Inc., in a single PAGA claim under the Labor Code. After summary adjudication and stipulations, the dispute narrowed to four violations: noncompliant wage statements, rest-period rounding, unpaid “uptime” overtime, and bonus pay left out of the regular rate.

Liability was resolved by stipulation and adjudication, so the parties submitted only the amount of civil penalties to the Orange County Superior Court on trial briefs. By Taduran’s own calculation, the maximum civil penalties came to nearly $56 million.

The trial court reduced that figure to roughly $516,000, explaining its reasoning violation by violation. It reduced several penalties on a per-employee basis and, on the bonus-pay issue, declined to reduce the penalty at all, imposing the full amount.

What the Court Held on the Method of Reduction

Taduran argued that any reduction had to be applied per pay period, because PAGA calculates the maximum penalty per pay period. The Court of Appeal disagreed. It reviewed the scope of the trial court’s authority de novo and the exercise of that authority for abuse of discretion.

Labor Code section 2699, subdivision (e)(2) lets a court award a “lesser amount” when the maximum would be unjust, arbitrary and oppressive, or confiscatory. The court explained that while section 2699, subdivision (f) calculates the maximum on a per-pay-period basis, it prescribes no formula for reducing that maximum.

Once the maximum is computed, the court held, a trial judge may reduce it by any reasonable method⁠—⁠by percentage, per pay period, or per employee. The court also rejected the argument that a per-employee reduction undercuts PAGA’s deterrent purpose, noting that the full penalty had been imposed on the bonus-pay issue.

What the Court Held on Fees

Taduran also challenged the fee award. On a lodestar of about $1.05 million he had sought a 1.5 multiplier; the trial court instead applied a 0.70 multiplier, awarding $733,440. He argued the reduction demanded “heightened scrutiny” on appeal⁠—⁠a standard some courts apply to across-the-board reductions and others reject, and one now pending before the California Supreme Court.

The court declined to resolve that dispute, holding that the trial judge had given specific, valid reasons under any standard: the records-based nature of the claims, the limited success measured against the recovery, and current billing rates “baked” into work performed years earlier at lower rates. Weighing the percentage of recovery, the court added, is proper in a representative action like PAGA. The judgment was affirmed in full.