Castillo v. Belkorp AG, LLP
CourtCalifornia Court of Appeal
Date FiledOctober 23, 2026
DocketF090527
StatusPublished
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Full Opinion
Filed 10/23/26
CERTIFIED FOR PUBLICATION
IN THE COURT OF APPEAL OF THE STATE OF CALIFORNIA
FIFTH APPELLATE DISTRICT
STEVEN CASTILLO,
F090527
Plaintiff and Respondent,
(Super. Ct. No. CV-25-001186)
v.
BELKORP AG, LLP,
OPINION
Defendant and Appellant.
APPEAL from a judgment of the Superior Court of Stanislaus County. John R.
Mayne, Judge.
Fisher & Phillips, Alden J. Parker, Yuri Khadka and Erin J. Price for Defendant
and Appellant.
Justice Law Corporation, Douglas Han, Christoper K. Petersen and Michael W.
Jones for Plaintiff and Respondent.
-ooOoo-
This is an employment-related dispute between defendant/appellant Belkorp AG,
LLC (Belkorp) and plaintiff/respondent Stephen Castillo. Former employee Castillo
brought purely nonindividual claims under Labor Code section 2698 et seq.,1 the Private
Attorneys General Act (PAGA), against Belkorp. Belkorp filed a motion to compel
arbitration, which the trial court denied. In this appeal, Belkorp contends the court erred
by: (1) failing to adjudicate the merits of its motion to compel arbitration; (2) concluding
that Castillo could maintain a PAGA action alleging only nonindividual PAGA claims;
and (3) failing to order the parties to arbitration. We affirm.
BACKGROUND
From May 2021, to his termination in late January 2024, Castillo worked for
Belkorp as a service technician. According to Belkorp’s Director of Human Resources,
in late December 2020, Castillo completed onboarding documents. Included within the
onboarding documents was an arbitration agreement that provided: “Any dispute or
controversy arising out of or relating to the employment, or termination of employment,
of [Castillo] by [Belkorp], … shall be resolved by binding arbitration.” As to class
actions or collective actions, the arbitration agreement specifically provided: “[Castillo]
and [Belkorp] agree to bring any claim or dispute in arbitration on an individual basis
only, and not as a class or collective action; [Castillo] and [Belkorp] waive any right for a
dispute or claim to be brought, heard, or decided as a class or collective action, and the
arbitrator has no power or authority to preside over a class or collective action (‘[c]lass
[a]ction [w]aiver’).” The arbitration agreement did not provide for any exceptions to the
class action waiver. However, the arbitration agreement did provide that, if the class
action waiver was found to be unenforceable, then the arbitrator would be “without
authority to preside over a class or collective action and any class or collective action
[would have to] be brought in a court of competent jurisdiction.”
In November 2024, pursuant to section 2699.3, Castillo provided written notice to
the Labor and Workforce Development Agency (LWDA) of Labor Code violations by
1 All further statutory references are to the Labor Code unless otherwise noted.
2.
Belkorp. The LWDA did not respond to Castillo’s notice within the 65-day statutory
waiting period of section 2699.3, subdivision (a)(2)(A). As a result, Castillo became
authorized to pursue civil penalties under PAGA as the proxy or agent of the LWDA.
(§ 2699.3, subd. (a)(2)(A).)
In February 2025, Castillo filed a complaint for civil penalties against Belkorp in
the Stanislaus County Superior Court. The complaint contained a single cause of action
under PAGA based on various violations of the Labor Code. The complaint expressly
stated that Castillo brought the action “as an exclusively representative action on behalf
of other current and former aggrieved employees of [Belkorp] for penalties .…” The
complaint further emphasized that Castillo sought “only to prosecute his non-individual
PAGA claims and does not seek to prosecute any individual PAGA claims against
[Belkorp].” The complaint sought penalties “on behalf of current and former aggrieved
employees of [Belkorp] and exclusively as a proxy of the State of California,” along with
attorney fees and costs.
In July 2025, Belkorp filed a motion to compel arbitration.
On September 5, 2025, the trial court conducted a hearing and issued a ruling that
denied the motion to compel. The court noted some procedural irregularities with respect
to Belkorp’s motion, including a breach of the duty of candor based on Belkorp’s failure
to advise that Leeper v. Shipt, Inc. (2024) 107 Cal.App.5th 1001, review granted
April 16, 2025, S289305 (Leeper) had been under review since April 16, 2025. On the
merits of the motion, the court explained:
“Review has been granted in Leeper and Rodriguez v. Packers
Sanitation Services LTD (2025) 109 Cal.App.5th 69, but CRST Expedited,
Inc. v. Superior Court of Fresno County (2025) 112 Cal.App.5th 872 has
taken the opposite side of the Leeper decision. The California Supreme
Court in its order under [California Rules of Court, rule] 8.1115(e)(3) has
permitted trial courts to use Leeper to show a split of authority.
“Thus, the Court must weigh the logic of both cases. [Belkorp]
declined to address CRST in its initial filing or its reply. This decision not
to cite to controlling authority and not to address it appears to this Court to
be a concession on the merits.”
3.
In September 2025, Belkorp appealed the denial of its motion to compel.
DISCUSSION
I. A PAGA ACTION WITH ONLY NONINDIVIDUAL PAGA CLAIMS
A. Parties’ Arguments
1. Belkorp
Belkorp contends the trial court erred by permitting Castillo to pursue only
nonindividual PAGA claims for several reasons. First, Belkorp argues that Castillo’s
complaint of necessity includes an individual PAGA claim that is brought on his own
behalf because PAGA requires an aggrieved employee to bring a claim on his own behalf
and on behalf of other employees. Belkorp argues that, as explained in Leeper, the
common meaning of “and” as conjunctive, when combined with the Legislature’s
decision to use the term and instead of or, means that an employee only has standing to
bring a PAGA action that consists both of individual and nonindividual PAGA claims.
Second, Belkorp argues that permitting Castillo to pursue only PAGA claims on
behalf of other employees is contrary to Viking River Cruises, Inc. v. Moriana (2022) 596
U.S. 639 (Viking River) and Adolph v. Uber Technologies, Inc. (2023) 14 Cal.5th 1104
(Adolph). Belkorp argues that these decisions envision and mandate that a PAGA action
will be divided between individual and nonindividual PAGA claims, with the individual
PAGA claims going to arbitration and the nonindividual PAGA claims remaining in
court.
Third, Belkorp points out that the Legislature amended PAGA effective July 1,
2024 (the July amendments), yet failed to include amendments that expressly permit a
PAGA action consisting only of nonindividual PAGA claims. Belkorp argues this means
that the Legislature did not intend to alter Viking River and Adolph and thus, intended for
all PAGA actions to include individual and nonindividual PAGA claims.
Finally, Belkorp acknowledges that CRST Expedited, Inc. v. Superior Court
(2025) 112 Cal.App.5th 872, review granted September 17, 2025, S292005 (CRST) and
Galarsa v. Dolgen California, LLC (2025) 115 Cal.App.5th 1, review granted
4.
December 17, 2025, S293545 (Galarsa) have held that a plaintiff may bring a PAGA
action consisting only of nonindividual PAGA claims. However, Belkorp argues that
these cases are procedurally and factually different from this case and were expressly
limited to the pre-July 1, 2024 version of PAGA, whereas this case is governed by the
version of PAGA that became effective on July 1, 2024. Belkorp also notes that the
July amendments require a plaintiff to have experienced each Labor Code violation
alleged. Belkorp argues this change requires an aggrieved employee to pursue a PAGA
action that consists of individual and nonindividual PAGA claims based on Labor Code
violations that were personally experienced, which is consistent with Viking River and
Adolph.
2. Castillo
Castillo contends the trial court correctly permitted him to pursue only
nonindividual PAGA claims. In part,2 Castillo argues that our court in CRST and
Galarsa explained the term and was ambiguous and should be construed as an inclusive
disjunctive that means either and or or. Castillo argues that CRST and Galarsa have
already considered and rejected most of Belkorp’s arguments, including its reliance on
Leeper, and that CRST and Galarsa should continue to be followed. Castillo also argues
that any factual differences that exist between this case and CRST and Galarsa are
2 Castillo also argues that Belkorp waived and is estopped through the doctrine of invited
error from making any challenge to the trial court’s adoption of CRST because Belkorp did not
address CRST in either its motion to compel arbitration or its reply. We disagree. First, an
“error is invited when a party purposefully induces the commission of [the] error,” and “requires
some form of active advocacy for the decision now claimed as error on appeal.” (Khoiny v.
Dignity Health (2022) 76 Cal.App.5th 390, 419.) Here, there was no active advocacy or
purposeful inducement by Belkorp for the trial court to follow CRST; there was simply reliance
on Leeper and a failure to address CRST. Second, courts often find a concession by a party’s
failure to respond to an opponent’s argument. (E.g., Ross v. Superior Court (2022) 77
Cal.App.5th 667, 681.) However, this is not an inexorable rule, and courts retain discretion to
consider the “conceding” party’s new arguments. (People v. Hill (1992) 3 Cal.4th 959, 995, fn.
3; Griffin v. The Haunted Hotel, Inc. (2015) 242 Cal.App.4th 490, 505.) Here, by relying on
Leeper during the motion to compel, Belkorp was implicitly urging the court to follow Leeper
and to reject CRST. Because Leeper and CRST are irreconcilable, and Belkorp continues to rely
on Leeper in this appeal, we will not find waiver or a concession for purposes of this appeal.
(Hill, at p. 995, fn. 3; Griffin, at p. 505.)
5.
immaterial, and the July amendments do not affect these cases’ conclusion that an
aggrieved employee who has been duly authorized as the LWDA’s representative may
bring “a PAGA action that asserts only nonindividual PAGA claims.” (CRST, supra, 112
Cal.App.5th at p. 913, review granted.) Such actions are sometimes referred to as
“ ‘headless’ PAGA actions.” (Galarsa, supra, 115 Cal.App.5th at p. 4, review granted.)
B. Legal Standard
1. Statutory Interpretation
In construing a statute, courts must ascertain the intent of the Legislature in order
to effectuate the statute’s purpose. (Shear Development Co., LLC v. California Coastal
Com. (2026) 19 Cal.5th 334, 366; Turrieta v. Lyft, Inc. (2024) 16 Cal.5th 664, 687.)
Courts first examine the statutory language, but consider the entire substance of the
statutory scheme without considering particular language in isolation. (Shear
Development, at p. 366; Turrieta, at p. 687.) If the language is clear and unambiguous,
then courts generally must follow the language’s plain meaning. (Shear Development, at
p. 366; Turrieta, at p. 687.) However, if the statutory language is ambiguous, meaning
that the language supports more than one reasonable construction, then courts may
consider other extrinsic aids, such as the statute’s purpose, legislative history, and public
policy. (Shear Development, at p. 366; Turrieta, at p. 687.) Appellate courts review
questions of statutory interpretation de novo (Adolph, supra, 14 Cal.5th at p. 1120).
2. PAGA
PAGA was enacted to remedy “ ‘systemic underenforcement’ ” of the Labor
Code. (Estrada v. Royalty Carpet Mills, Inc. (2024) 15 Cal.5th 582, 598.) In order to
achieve maximum compliance with the Labor Code, PAGA provides that civil penalties,
which would otherwise be recovered only by the LWDA, “may, as an alternative, be
recovered through a civil action brought by an aggrieved employee on behalf of the
employee and other current and former employees against whom a violation of the same
provision was committed .…” (§ 2699, subd. (a) (section 2699(a)); Stone v. Alameda
Health System (2024) 16 Cal.5th 1040, 1078, fn. 22; see also Adolph, supra, 14 Cal.5th at
6.
p. 1122 [“ ‘The Legislature’s sole purpose in enacting PAGA was “to augment the
limited enforcement capability of the [LWDA] by empowering employees to enforce the
Labor Code as representatives of the [LWDA]” ’ ”].) PAGA defines an “aggrieved
employee” as “any person who was employed by the alleged violator and personally
suffered each of the violations alleged during the [one-year limitations period set by Code
of Civil Procedure section 340.]” (§ 2699, subd. (c)(1) (section 2699(c)(1)); Prime
Healthcare Management, Inc. v. Superior Court (2025) 117 Cal.App.5th 127, 138 (Prime
Healthcare.) In seeking civil penalties through PAGA, the aggrieved employee “acts
‘ “ ‘as the proxy or agent’ ” ’ of the state.” (Adolph, at p. 1116; Kim v. Reins
International California, Inc. (2020) 9 Cal.5th 73, 81 (Kim).) Therefore, a PAGA action
is a law enforcement action between the state/LWDA and the defendant employer, with
the plaintiff aggrieved employee acting on behalf of the LWDA. (See Adolph, at p. 1117;
Kim, at p. 86.)
Because PAGA is intended primarily to benefit the general public, the recovered
civil penalties are dedicated largely to public use, to remediate present violations, and to
deter future violations; the penalties are not intended to compensate or redress the
aggrieved employee’s individual injuries. (Adolph, supra, 14 Cal.5th at p. 1116; Kim,
supra, 9 Cal.5th at p. 86.) By statute, 65 percent of the PAGA civil penalties recovered
goes to the LWDA and the remaining 35 percent goes to the aggrieved employees.
(§ 2699, subd. (m); see Stone v. Alameda Health System, supra, 16 Cal.5th at p. 1076,
fn. 19.) PAGA plaintiffs also may obtain injunctive relief against their employers.
(§ 2699, subd. (e)(1).) Questions regarding the interpretation of PAGA are reviewed
de novo. (Adolph, at p. 1120; Galarsa, supra, 115 Cal.App.5th at p. 8, review granted.)
Since PAGA is a remedial statute meant to protect employees, its provisions are to
be broadly construed in favor of this protection. (Kim, supra, 9 Cal.5th at p. 83; see also
Adolph, supra, 14 Cal.5th at p. 1122.) Consistent with a broad construction, wage and
hour related laws are not to be construed within the “ ‘ “ ‘narrow limits of the letter of the
7.
law, but rather are to be given liberal effect to promote the general object sought to be
accomplished.’ ” ’ ” (CRST, supra, 112 Cal.App.5th at p. 901, review granted.)
3. Arbitration of PAGA Claims
In the context of the Federal Arbitration Act (FAA) (9 U.S.C. § 1 et seq.), the
United States Supreme Court has found that a PAGA action contains two components, an
“individual claim,” which is based on Labor Code violations that were personally
experienced by the plaintiff, and “representative claims”3 or “nonindividual claims,”
which are based on Labor Code violations that were experienced by other current and
former employees. (Viking River, supra, 596 U.S. at pp. 648–649; Adolph, supra, 14
Cal.5th at pp. 1117–1118.) An arbitration agreement’s predispute categorical waiver of
the right to bring a PAGA action is unenforceable. (Viking River, at pp. 659–663;
Adolph, at p. 1117; Santana v. Studebaker Health Care Center, LLC (2026) 120
Cal.App.5th 1, 15–16 (Santana).) Further, narrow waivers in arbitration agreements that
require employees to arbitrate individual PAGA claims and relinquish their ability to
bring nonindividual PAGA claims also are unenforceable. (Viking River, at pp. 662–663;
Adolph, at pp. 1117–1118; Santana, at p. 16.) However, the FAA permits arbitration
agreements to divide a PAGA action into individual PAGA claims and nonindividual
PAGA claims and to then arbitrate the individual PAGA claims.4 (Viking River, at
p. 662; Adolph, at pp. 1118–1119; Santana, at p. 16.) If a plaintiff files “a PAGA action
comprised of individual and non-individual claims,” and there is a valid arbitration
agreement that encompasses the individual PAGA claims, then the individual PAGA
3 A PAGA action is also “representative” in the sense that a PAGA plaintiff acts as the
proxy or agent of the state/LWDA. (Viking River, supra, 596 U.S. at p. 648; ZB, N.A. v.
Superior Court (2019) 8 Cal.5th 175, 185.)
4 Prior to Viking River, California courts relied on Iskanian v. CLS Transportation Los
Angeles, LLC (2014) 59 Cal.4th 348 (Iskanian) to prohibit employers from requiring employees
to “ ‘split’ PAGA actions in a manner that puts individual and non-individual components of a
PAGA claim into bifurcated proceedings.” (Adolph, supra, 14 Cal.5th at p. 1118.) However,
Viking River held that “the FAA preempts [this aspect] of Iskanian insofar as it precludes
division of PAGA actions into individual and non-individual claims through an agreement to
arbitrate.” (Viking River, supra, 596 U.S. at p. 662; Adolph, at p. 1118.)
8.
claims are to be ordered to arbitration and the nonindividual PAGA claims are to remain
in court. (Adolph, at pp. 1123, 1126.)
C. Analysis5
The issue here is whether an aggrieved employee may bring a PAGA action that
consists only of nonindividual PAGA claims, or instead must the action consist of both
individual and nonindividual PAGA claims. There is a split of authority on this issue
under the version of PAGA in effect before the July amendments. Divisions One and
Five of the Second District have concluded that a PAGA plaintiff must bring a PAGA
action that consists of both individual and nonindividual PAGA claims. (Williams v.
Alacrity Solutions Group, LLC (2025) 110 Cal.App.5th 932, 937, review granted July 9,
2025, S291199; Leeper, supra, 107 Cal.App.5th at p. 1009, review granted.) Our court
and Division Six of the Second District have reached the opposite conclusion and
determined that an aggrieved employee may bring a PAGA action that consists only of
nonindividual PAGA claims. (Galarsa, supra, 115 Cal.App.5th at p. 4, review granted;
CRST, supra, 112 Cal.App.5th at p. 883, review granted; Balderas v. Fresh Start
Harvesting, Inc. (2024) 101 Cal.App.5th 533, 536 (Balderas).) Because we detect no
reason to depart from CRST, we conclude that an aggrieved employee may bring a PAGA
action that consists only of nonindividual PAGA claims under the post-July 1, 2024
version of PAGA.
5 Castillo argues this appeal may be resolved through application of Rodriguez v. Packers
Sanitation Services LTD., LLC (2025) 109 Cal.App.5th 69, review granted May 14, 2025,
S290182 (Rodriguez), which held that a motion to compel arbitration is properly denied when a
complaint alleges only nonindividual PAGA claims. (Id., at pp. 72, 75, 80.) Rodriguez held that
to the extent a PAGA action must contain both individual and nonindividual claims, which was a
question that Rodriguez did not actually resolve, then the proper procedure would be to challenge
the sufficiency of the pleading through a demurrer. (Id. at pp. 78, 80–81.) We agree that
Rodriguez is on point and would justify affirming the trial court’s denial of the motion to
compel. (See id. at p. 80.) However, we read the court’s order as showing that it considered
both Leeper and CRST and adopted CRST. If we were to follow Rodriguez, we would ultimately
be sending the matter back to the court to reconsider Leeper and CRST in a different defense
motion, even though the trial court already did so and even though the issue of whether to follow
Leeper or CRST has been fully briefed in this appeal. Given the nature of the court’s order, the
state of the briefing on appeal, and the significance of the issue posed, we will not rely on
Rodriguez to fully resolve this appeal.
9.
1. CRST Decision
CRST thoroughly analyzed the pre-July 1, 2024 version of section 2699(a) and
determined that an aggrieved employee may bring an action that consists only of
nonindividual PAGA claims. (CRST, supra, 112 Cal.App.5th at pp. 883, 917, review
granted.) CRST summarized the issues and its rationale as follows:
“The parties’ arguments on whether headless PAGA actions are
allowed focus on the meaning of the phrase ‘on behalf of himself or herself
and other current or former employees’ in a sentence that uses the
permissive verb ‘may.’ (§ 2699, former subd. (a), italics added.) We
recognize that and usually, but not always, is interpreted as a conjunctive
that means ‘also’ or ‘ “ ‘ “an additional thing.” ’ ” ’ (People v. Reynoza
(2024) 15 Cal.5th 982, 990.) In exceptional situations, however, it is
sometimes ‘ “fair and rational” ’ to construe and disjunctively. (Ibid.) We
conclude PAGA is not an ordinary statute, the problems it attempts to
remedy are unusual, and Viking River drastically altered the legal landscape
in which PAGA is applied. These exceptional circumstances and the
PAGA’s underlying purpose support the following legal conclusions. First,
the and in former [section 2699(a)] is ambiguous. Second, PAGA’s
purpose of encouraging enforcement of California’s labor laws is best
served by interpreting the ambiguous and liberally to include both and and
or. Thus, the subdivision permitted the employee, as a representative of the
[LWDA], to bring a PAGA action seeking the recovery of civil penalties
(1) for the Labor Code violations suffered only by the employee, (2) for the
Labor Code violations suffered only by other employees, or (3) both. In
short, headless PAGA actions were among the choices allowed the
LWDA’s representatives.” (CRST, supra, 112 Cal.App.5th at p. 883,
review granted.)
CRST proceeded to explain its rationale and analysis in greater detail. With
respect to ambiguity, CRST noted that Viking River dramatically changed how a PAGA
action was viewed. (CRST, supra, 112 Cal.App.5th at p. 907, review granted.) Whereas
it had been understood that PAGA actions could not be divided between individual and
nonindividual claims and then decided in separate forums, Viking River held that the
FAA compelled such a division when a predispute arbitration agreement applied to the
claims. (CRST, at p. 907.) CRST also found a statement in Iskanian v. CLS
Transportation Los Angeles, LLC, supra, 9 Cal.4th 348 to be significant, although it was
dicta. (CRST, at p. 908.) “As Justice Chin correctly observes, ‘every PAGA action,
10.
whether seeking penalties for Labor Code violations as to only one aggrieved
employee—the plaintiff bringing the action—or as to other employees as well, is a
representative action on behalf of the state.’ ” (Iskanian, at p. 387.) This statement,
combined with section 2699(a)’s use of the permissive word may led CRST to conclude
that there were at least two reasonable interpretations of and as used by section 2699(a):
(1) an aggrieved employee could choose to bring either no PAGA action or a PAGA
action that consists of both an individual claim and nonindividual claims; or (2) an
aggrieved employee could choose to bring either no PAGA action, a PAGA action that
consisted only of an individual PAGA claim, a PAGA action that consisted only of
nonindividual PAGA claims, or a PAGA action that consisted of both individual and
nonindividual PAGA claims. (CRST, at pp. 908–909.)
CRST also noted that there was an ambiguity grammatically speaking. (CRST,
supra, 112 Cal.App.5th at pp. 910–911, review granted.) CRST explained that if a parent
permitted a child to have a snack of cookies and ice cream, and the child ate only
cookies, then linguistically there would be no violation of the permission given because
the greater permission to have both cookies and ice cream included the lesser permission
to have either. (Id. at p. 911.) This grammatical point was also consistent with California
law, which recognizes “ ‘[t]he greater contains the less.’ ” (Ibid., quoting Civ. Code,
§ 3536.) Because these considerations demonstrated that more than one reasonable
interpretation was possible, CRST determined that section 2699(a)’s use of the word and
was ambiguous. (CRST, at p. 911; Civ. Code, § 3536.)
To resolve the ambiguity, CRST examined legislative intent. First, CRST found
the legislative history surrounding the word and in section 2699(a) was inconclusive.
While there was a technical amendment by the author that changed or to and, there was
no explanation of how this change was intended to affect the meaning of section 2699(a).
(CRST, supra, 112 Cal.App.5th at p. 912, review granted.) Second, CRST noted the
general legislative purpose of promoting Labor Code enforcement and remedying
systemic underenforcement of worker protections, including penalizing and deterring
11.
Labor Code violations. (CRST, at pp. 913–916; see also Adolph, supra, 14 Cal.5th at
p. 1122 [noting that the “ ‘sole purpose’ ” of PAGA was to augment the LWDA’s ability
to enforce the Labor Code].) Any hurdles that undermine these objectives were to be
avoided. (CRST, at p. 914; see also Adolph, at pp. 1122–1123.). Third, CRST determined
that applying arbitration agreements to individual PAGA claims as required by Viking
River would result in “bifurcated proceedings across two forums” and constitute “a
hurdle in the sense that they slow down the prosecution of the nonindividual PAGA
claims, which nearly always will address more violations and result in more civil
penalties than the individual PAGA claims.” (CRST, at p. 916.) Specifically, case law
suggested that a two-year delay was caused by arbitrating individual PAGA claims first
while the nonindividual PAGA claims were stayed in court. (Id. at pp. 915–916.)
CRST also noted that empirical studies suggested that arbitrators were more likely
than a court to find a PAGA plaintiff was not “an aggrieved employee,” and thus, unable
to recover. (CRST, supra, 112 Cal.App.5th at p. 916, review granted.) Requiring a
PAGA plaintiff to pursue both individual and nonindividual PAGA claims would likely
result in “slower and less favorable outcomes [and] would undercut the incentives created
by PAGA,” and thus, result in fewer PAGA actions being filed. (Id. at pp. 916–917.)
In light of these considerations, CRST resolved the ambiguity within PAGA by
concluding that “the interpretation of PAGA that best promotes ‘effective code
enforcement’ [citation] and provides the more ‘effective disincentive for employers to
engage in unlawful and anticompetitive business practices’ [citation] allows PAGA
plaintiffs and their counsel the flexibility to choose among bringing a PAGA action that
seeks to recover of civil penalties on (1) the LWDA’s individual PAGA claims, (2) the
LWDA’s nonindividual PAGA claims, or (3) both.” (CRST, supra, 112 Cal.App.5th at
p. 917, review granted.)
Even though CRST analyzed a version of section 2699(a) that has since been
amended and does not therefore apply to this case, we are satisfied that CRST’s rationale
should be followed in this case. CRST’s approach correctly recognizes the importance of
12.
the word and within current section 2699(a). In most cases, the word and will have a
conjunctive meaning. However, since 1865, our Supreme Court has recognized that and
may fairly and rationally be interpreted disjunctively to also mean or. (People v. Pool
(1865) 27 Cal. 572, 581; see also People v. Reynoza, supra, 15 Cal.5th at p. 986; CRST,
supra, 112 Cal.App.5th at p. 904, review granted.) While interpreting and to have a
disjunctive meaning is clearly not the norm and is to be done only in exceptional cases
(Reynoza, at p. 991; CRST, at p. 904), CRST persuasively explains why those exceptional
circumstances exist in this case.
PAGA is a unique statute that deputizes employees to act as enforcement agents
for the LWDA. (Adolph, supra, 14 Cal.5th at p. 1116; CRST, supra, 112 Cal.App.5th at
pp. 895, 906, 913, review granted.) Importantly, Viking River dramatically changed the
legal landscape concerning PAGA and overturned eight years of settled California law
under Iskanian when it permitted employers through arbitration clauses to require an
employee to litigate individual and nonindividual PAGA claims in different forums. (See
Adolph, at pp. 1117–1118; Santana, supra, 120 Cal.App.5th at pp. 15–16; CRST, at
p. 907.) Some results of this forced division are a significant delay in resolving
nonindividual PAGA claims and an apparent increased risk of negative results for
individual PAGA claims in arbitration, which would have a corresponding negative effect
on the nonindividual claims in court. (CRST, at pp. 916–917.) In light of Viking River,
we conclude the interpretation and construction of PAGA that best furthers the objective
of effective Labor Code enforcement is the interpretation that permits an aggrieved
employee to bring a PAGA action that consists only of nonindividual PAGA claims.
(CRST, at pp. 883, 917; see also Adolph, at pp. 1122–1123 [eschewing an interpretation
of PAGA that would impede and undermine employee enforcement of PAGA and
accepting the interpretation that furthered PAGA’s purpose].) This is achieved by
interpreting the ambiguous term and in current section 2699(a) to have a disjunctive
meaning that includes or. (CRST, at pp. 883, 894–895, 917; see also Adolph, at p. 1123;
Balderas, supra, 101 Cal.App.5th at pp. 537–539.)
13.
2. Belkorp’s Arguments Do Not Undermine CRST
As outlined above, Belkorp argues that we should decline to follow CRST in this
case for a number of reasons. We are not convinced by Belkorp’s arguments.
a. The Leeper Decision
Prior to CRST, Leeper examined the nature of a PAGA action and
section 2699(a)’s use of the word and. (Leeper, supra, 107 Cal.App.5th at pp. 1009–
1010, review granted.) Leeper noted the word and is ordinarily used in a conjunctive
sense to unify and connect multiple items. (Id. at p. 1009.) Because the word and
separates individual claims from nonindividual claims in the statutory text, Leeper
reasoned that section 2699(a) meant that an aggrieved employee’s PAGA action must
necessarily consist of both individual claims and nonindividual claims. (Leeper, at
p. 1009.) Leeper also concluded that legislative history supported this conclusion.
Leeper explained that the Senate bill initially used the term or instead of and. (Id. at
p. 1010.) However, the bill’s author made an “ ‘author’s technical amendment’ ” and
replaced or with and in order to “ ‘clarify the intent of the bill and correct drafting
errors.’ ” (Ibid.) Because section 2699(a) was ultimately passed with and instead of or,
Leeper concluded that the Legislature clearly intended for a PAGA action to consist of
both individual and nonindividual PAGA claims. (Leeper, at p. 1010.) As noted above,
Leeper has been followed by Williams. Nevertheless, for the reasons explained below,
we decline to follow Leeper.6
First, we are not satisfied that the legislative history is as clear as Leeper
concluded. As noted above, CRST examined the same legislative history and found it to
be inconclusive. Specifically, CRST explained:
“Unfortunately, the analysis did not explain how the change affected
the provision’s meaning. For example, it did not state the author intended
the substitution of and for or to implement an all-or-nothing approach with
respect to the pursuit of civil penalties in a PAGA action. Conversely, it
6 Since Williams’s analysis is essentially the same as the analysis of Leeper (Williams v.
Alacrity Solutions Group, LLC, supra, 110 Cal.App.5th at pp. 942–943, review granted), we also
reject Williams’s analysis. (Galarsa, supra, 115 Cal.App.5th at pp. 10–15, review granted.)
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did not state the substitution was made to clarify the breadth of the
permission given so it would correspond with the permission given in our
example of a parent allowing a child to have a snack of cookies and ice
cream. In short, the reference to correcting a drafting error does not inform
us whether the author intended to require potential PAGA plaintiffs to
make the following choice: pursue PAGA claims for violations suffered by
both the plaintiff and other employees or, alternatively, forgo all PAGA
claims. Thus, notwithstanding the correction of a drafting error, the inquiry
into the author’s original intent in 2003 does not provide an unequivocal
answer.” (CRST, supra, 112 Cal.App.5th at p. 912, review granted.)
Galarsa recently reiterated CRST’s analysis and expressly rejected Leeper.
(Galarsa, supra, 115 Cal.App.5th at pp. 12–13, review granted.) Galarsa more pointedly
noted that, without an explanation of how “the text containing and would be applied in
the manner intended by the author,” the “statement that the Legislature accepted the
change of or to and without opposition begs, rather than answers, the question of what
the author or the Legislature intended by the change.” (Ibid.) We agree with CRST and
Galarsa’s critique of Leeper’s analysis of PAGA’s legislative history.
Second, Leeper’s statutory analysis has significant omissions. As explained in
Galarsa, Leeper did not recognize that our Supreme Court and various secondary sources
have acknowledged that and can be interpreted disjunctively to also mean or in
extraordinary cases. (Galarsa, supra, 115 Cal.App.5th at pp. 13–14, review granted.)
Instead, Leeper simply noted that and has a conjunctive meaning. Leeper also did not
acknowledge our Supreme Court’s directive regarding interpretations of the Labor Code.
(Galarsa, at pp. 10–11.) Specifically, Leeper did not acknowledge that wage, hour, and
working condition laws are to be liberally construed to promote worker protection and
that such laws should “ ‘ “ ‘not [be] construed within narrow limits of the letter of the
law, but rather are to be given liberal effect to promote the general object sought to be
accomplished.’ ” [Citations.]’ ” (Galarsa, at p. 11.) Instead, Leeper overemphasized the
“ ‘ “ ‘letter of the law’ ” ’ ” by focusing on the usual conjunctive meaning of and in
reaching its conclusions. (Galarsa, at p. 11, italics omitted.)
Finally, Galarsa noted that, unlike CRST, Leeper did not explain how its
interpretation, “when applied to the current legal landscape, creates incentives that have
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the practical effect of maximizing the enforcement of labor laws.” (Galarsa, supra, 115
Cal.App.5th at p. 14, review granted; see also Adolph, supra, 14 Cal.5th at pp. 1122–
1123 [“An interpretation of [PAGA] that impedes an employee’s ability to prosecute his
or her employer’s violations committed against other employees would undermine
PAGA’s purpose of augmenting enforcement of the Labor Code.”].) These omissions are
significant and undercut Leeper’s analysis of section 2699(a).7
b. Standing
Belkorp argues that Castillo does not have standing to pursue only nonindividual
PAGA claims. Belkorp is incorrect.8
First, Belkorp’s argument is based on a conjunctive interpretation of the word and
in section 2699(a). However, as explained above, it is appropriate to interpret and as
used in section 2699(a) to have an inclusive disjunctive meaning that includes or.
Second, our Supreme Court has held that the requirements for PAGA standing are
found in section 2699(c)(1), which defines the term “aggrieved employee.” (Adolph,
supra, 14 Cal.5th at p. 1120; Kim, supra, 9 Cal.5th at pp. 83–84.) An “aggrieved
employee” is “any person who was employed by the alleged violator and personally
suffered each of the violations alleged during the [one-year limitations period of Code of
Civil Procure section 340].” (§ 2699(c)(1); Prime Healthcare, supra, 117 Cal.App.5th at
p. 138.) Therefore, under section 2699(c)(1), a PAGA plaintiff has standing as an
aggrieved employee if the plaintiff: (1) was employed by the defendant employer; and
(2) personally suffered each alleged violation within the one-year limitations period.
7 Belkorp notes some factual and procedural differences between this case and CRST and
Galarsa. However, those differences are immaterial. Whether an aggrieved employee may
bring only nonindividual PAGA claims is determined by interpreting the language of section
2699; it is not determined by the procedural or factual posture of this case.
8 To the extent Belkorp is arguing the allegations in the complaint are insufficient to
demonstrate Castillo personally does not having standing, that is a pleading defect. The proper
procedural mechanism to raise such a pleading defect is a demurrer, not a motion to compel
arbitration. (City of Riverside v. Stansbury (2007) 155 Cal.App.4th 1582, 1594.) Because we
are reviewing the denial of a motion to compel, we express no opinion regarding the pleading
adequacy of Castillo’s complaint.
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(§ 2699(c)(1); accord, Adolph, at p. 1120 [discussing two requirements for standing under
former section 2699, subdivision (c)].)
As can be seen, although an aggrieved employee must have suffered each alleged
Labor Code violation, there is no requirement that the aggrieved employee must also seek
to recover penalties for the Labor Code violations that were personally experienced. In
other words, the key to standing is having personally experienced all alleged Labor Code
violations within the one-year period. (§ 2699(c)(1); see also Adolph, supra, 14 Cal.5th
at pp. 1120, 1126; Kim, supra, 9 Cal.5th at pp. 84–85.)
Adolph concluded that settlements of individual Labor Code claims that occurred
after the filing of a PAGA complaint, as in Kim, and a plaintiff’s inability to pursue
individual Labor Code claims because such claims were barred by the statute of
limitations, as in Johnson v. Maxim Healthcare Services, Inc. (2021) 66 Cal.App.5th 924,
did not affect the ability of such plaintiffs to pursue PAGA actions. 9 (Adolph, supra, 14
Cal.5th at pp. 1120–1121.) This was because “a worker becomes an ‘aggrieved
employee’ with standing to litigate claims on behalf of fellow employees upon sustaining
a Labor Code violation committed by his or her employer.” (Id. at p. 1121.)
As applied to arbitration and splitting individual PAGA claims from nonindividual
PAGA claims, Adolph determined that “[a]rbitrating a PAGA plaintiff’s individual claim
does not nullify the fact of the violation or extinguish the