The COVID-19 vaccine has us hopeful for a return to “normal” in the New Year. Unfortunately, many of California’s small businesses may not be around to see it.
In addition to mandated shutdowns, Golden State employers are being financially crippled by frivolous lawsuits filed under the Private Attorneys General Act (PAGA). PAGA is a unique California law that allows aggrieved employees to file suit against their employer for even a small or accidental violation of California’s more than 1,100-page labor law digest. These lawsuits, while lucrative for the state’s trial attorneys, often cost businesses thousands, if not millions, in settlement and legal fees.
Take Lars Viklund, for example. For years, Lars invested in his community by revitalizing small but historic hotels, including the Del Marcos Hotel in Palm Springs. The 17-room establishment even had its Class 1 historic site designation made official by the Palm Springs City Council in 2012. All of his properties are on the smaller side — typically between 10-18 rooms. But they each employ dozens of staff members who rely on the hotels for their livelihood.
Like many in the hospitality industry, Lars has been devastated by the COVID-19 pandemic and the resulting lockdowns. This financial strain has only been exacerbated by an expensive and drawn-out legal battle.