Raines v. Coastal Pacific Food Distributors

Filed 5/22/18
CERTIFIED FOR PUBLICATION

IN THE COURT OF APPEAL OF THE STATE OF CALIFORNIA
THIRD APPELLATE DISTRICT
(San Joaquin)
----

TERRI RAINES, C083117

Plaintiff and Appellant, (Super. Ct. Nos. STK-CV-
UOE-2014-0005703, 39-2014-
v. 00312169-CU-OE-STK)

COASTAL PACIFIC FOOD DISTRIBUTORS, INC.,

Defendant and Respondent.

APPEAL from a judgment of the Superior Court of San Joaquin County, Linda L.
Lofthus, Judge. Reversed in part and affirmed in part.

Mayall Hurley, William J. Gorham III and Nicholas J. Scardigli for Plaintiff and
Appellant.

Weintraub Tobin Chediak Coleman Grodin, Charles L. Post, Brendan J. Begley,
Meagan D. Bainbridge and James Kachmar for Defendant and Respondent.

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 After defendant Coastal Pacific Food Distributors, Inc. (Coastal Pacific)
terminated plaintiff Terri Raines from her employment there, Raines sued Coastal Pacific
for age and disability discrimination and other related claims. In addition, she sought
recovery, both individually and in a representative capacity under the Private Attorneys
General Act of 2004 (PAGA) (Lab. Code, § 2698 et seq.),1 for Coastal Pacific’s failure to
provide and maintain accurate wage statements as required by section 226, subdivision
(a) (section 226(a) and its provisions). Raines appeals from a judgment in favor of
Coastal Pacific after the trial court reversed its original ruling denying Coastal Pacific’s
motion for summary adjudication and instead granted the motion as trial was about to
begin.
Raines contends triable issues of fact remain on her individual claim for statutory
penalties under section 226, subdivision (e) (section 226(e) and its provisions). Section
226(e) authorizes an “employee suffering injury as a result of a knowing and intentional
failure by an employer to comply with subdivision (a)” to recover damages or statutory
penalties. Raines contends there are triable factual issues as to whether she sustained an
injury and whether Coastal Pacific’s failure to provide accurate wage statements was
knowing and intentional. She next contends the trial court erred in granting summary
adjudication on her PAGA claim by improperly finding injury was required. Finally, she
contends the trial court committed procedural error in reversing its original order denying
summary adjudication.
We find merit only in the second contention. As we explain, a representative
PAGA claim for civil penalties for a violation of section 226(a) does not require proof of
injury or a knowing and intentional violation. This is true even though these two
elements are required to be proven when bringing an individual claim for damages or

1 Further undesignated statutory references are to the Labor Code.

2
statutory penalties under section 226(e). Because the trial court erroneously required
proof of injury on the PAGA claim, the grant of summary adjudication was improper and
we therefore reverse the judgment as to that claim.
FACTUAL AND PROCEDURAL BACKGROUND
Coastal Pacific hired Raines as a billing clerk in 1998 and terminated her
employment in 2014. Raines filed suit against Coastal Pacific, alleging age
discrimination, disability discrimination, and related claims. As relevant here, the first
amended complaint alleged Coastal Pacific failed to furnish Raines and other employees
accurate itemized wage statements showing the applicable hourly rates in effect during
the pay period and the corresponding number of hours worked at each hourly rate and
failed to maintain copies of accurate wage statements, as required by section 226(a).
Raines sought to recover both statutory penalties on an individual basis and civil
penalties on a representative basis under PAGA, as well as attorney fees, costs, and
interest.
Coastal Pacific filed a motion for summary judgment or summary adjudication,
seeking dismissal of all of Raines’s claims. While Coastal Pacific was successful with
respect to many of the claims, the trial court denied summary adjudication as to the claim
for age discrimination and failure to prevent age discrimination, and the claims for failure
to furnish and maintain accurate wage statements. As to the Labor Code violations, the
court found recovery under PAGA was permissible and there was a triable issue as to
whether the information necessary to determine applicable hourly rates was on the pay
stub.
The parties then settled the age discrimination claims, leaving only the section
226(e) and PAGA claims to be resolved.
The parties stipulated that from November 28, 2013, through February 28, 2015,
the wage statements issued by Coastal Pacific did not include the overtime hourly rate of
pay. Those wage statements did include both the number of overtime hours worked by

3
the employee and the total overtime pay. The parties further stipulated that Raines had
provided notice to the Labor and Workforce Development Agency of her allegations of
section 226 violations, a prerequisite for a PAGA claim.
The parties stipulated that before the issues of injury and a knowing and
intentional violation, as those terms are defined in section 226(e), were submitted to the
jury, the trial court should determine the legal issue of whether Raines was required to
prove she suffered injury in order to obtain civil penalties under PAGA. If the court
found proof of injury was not required to prove a PAGA claim, the parties stipulated
there were 16,252 violations for failure to furnish an accurate wage statement, and zero
violations for failure to maintain wage statements.
Coastal Pacific submitted a trial brief in which it argued that if the trial court
determined a jury trial was appropriate, it should first resolve two legal questions. First,
it argued the question of injury could be decided as a matter of law, asking the court to
find the overtime hourly rate was “readily ascertainable” under the “reasonable person”
standard because it required only simple math to calculate. Second, Coastal Pacific
argued that if Raines were not entitled to statutory penalties under section 226(e) because
of the absence of injury, she could not recover civil penalties under PAGA.
In her trial brief, Raines stated her remaining claims as (1) an individual claim for
statutory penalties under section 226(e) for failure to furnish accurate wage statements;
(2) an individual claim for statutory penalties under section 226(e) for failure to maintain
copies of accurate wage statements; and (3) a representative PAGA claim for civil
penalties for failure to furnish accurate wage statements. Raines argued the threshold
issue of whether an injury was required for a PAGA claim had already been decided by
the trial court in its ruling on the summary judgment motion.

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 The court ruled Raines had not suffered an injury, as required for the individual
claim under section 226(e), because the hourly overtime rate could be determined from
the wage statement by simple math. The court reversed its earlier decision on the motion
for summary adjudication as to the causes of action pertaining to Labor Code violations.
Raines objected, claiming the trial court was granting an untimely motion for
reconsideration and that it modified its summary adjudication order without notice to the
parties. The court rejected these objections, finding it was not bound by its previous
ruling. In its judgment in favor of Coastal Pacific, the court noted it was modifying its
earlier order. It determined a reasonable person could determine the overtime hourly rate
from the wage statement; consequently, there was no injury. Without an injury, the
section 226(e) claim failed. The court found an injury was also necessary for the PAGA
claim. Because the failure to furnish claim failed, so did the failure to maintain claim.
Raines moved for a new trial. The trial court denied the motion.
DISCUSSION
I
Section 226 and Its Enforcement
Section 226(a) requires an employer to provide employees with an accurate
itemized wage statement including nine specified items. One of the items to be included
in the wage statement is “all applicable hourly rates in effect during the pay period.”
(§ 226(a)(9).) Here, the parties stipulated that Raines received wage statements that did
not show the overtime hourly rate. Thus, it was undisputed there was at least a technical
violation of section 226(a). The remaining issue is the remedy, if any.
There are three different potential remedies available for a violation of section
226(a): (1) actual damages or statutory penalties; (2) injunctive relief; and (3) civil
penalties. First, “An employee suffering injury as a result of a knowing and intentional
failure by an employer to comply with subdivision (a) is entitled to recover the greater of
all actual damages or fifty dollars ($50) for the initial pay period in which a violation

5
occurs and one hundred dollars ($100) per employee for each violation in a subsequent
pay period, not to exceed an aggregate penalty of four thousand dollars ($4,000), and is
entitled to an award of costs and reasonable attorney’s fees.” (§ 226(e)(1).) As discussed
in detail post, the statute further defines “injury.” Second, an employee may bring an
action for injunctive relief to ensure compliance. (§ 226, subd. (h).) Third, there are civil
penalties for a violation of section 226(a). Section 226.3 provides: “Any employer who
violates subdivision (a) of Section 226 shall be subject to a civil penalty in the amount of
two hundred fifty dollars ($250) per employee per violation in an initial citation and one
thousand dollars ($1,000) per employee for each violation in a subsequent citation, for
which the employer fails to provide the employee a wage deduction statement or fails to
keep the records required in subdivision (a) of Section 226.”
There are two mechanisms for collecting civil penalties for labor law violations
under PAGA, through the state and personally. “The State’s labor law enforcement
agencies—the Labor and Workforce Development Agency (LWDA) and its constituent
departments and divisions—are authorized to assess and collect civil penalties for
specified violations of the Labor Code committed by an employer.” (Caliber Bodyworks,
Inc. v. Superior Court (2005) 134 Cal.App.4th 365, 370, fn. omitted.) The Legislature
adopted PAGA to address the shortage of government resources to enforce labor laws.
The solution was to permit an aggrieved employee to bring an action personally and on
behalf of other current or former employees to recover civil penalties. (Iskanian v. CLS
Transportation Los Angeles, LLC (2014) 59 Cal.4th 348, 379-380 (Iskanian).) Section
2699, subdivision (a) provides: “Notwithstanding any other provision of law, any
provision of this code that provides for a civil penalty to be assessed and collected by the
[LWDA] or any of its departments, divisions, commissions, boards, agencies, or
employees, for a violation of this code, may, as an alternative, be recovered through a
civil action brought by an aggrieved employee on behalf of himself or herself and other
current or former employees pursuant to the procedures specified in Section 2699.3.” Of

6
the penalties recovered, 75 percent are distributed to the LWDA for enforcement and
education; the remaining 25 percent is distributed to aggrieved employees. (§ 2699,
subd. (i).)
“An employee plaintiff suing, as here, under [PAGA], does so as the proxy or
agent of the state’s labor law enforcement agencies. The act’s declared purpose is to
supplement enforcement actions by public agencies, which lack adequate resources to
bring all such actions themselves. [Citation.] In a lawsuit brought under the act, the
employee plaintiff represents the same legal right and interest as state labor law
enforcement agencies—namely, recovery of civil penalties that otherwise would have
been assessed and collected by the [LWDA]. [Citation.]” (Arias v. Superior Court
(2009) 46 Cal.4th 969, 986.)
“The central provision of PAGA is section 2699. Subdivision (a) of the statute
permits aggrieved employees to recover civil penalties that previously could be collected
only by LWDA. [Citation.] In addition, to address violations for which no such penalty
had been established, subdivision (f) of the statute created ‘a default penalty and a private
right of action’ for aggrieved employees. [Citation.]” (Home Depot U.S.A., Inc. v.
Superior Court (2010) 191 Cal.App.4th 210, 216.)
Raines sought recovery under the default provision of section 2699, subdivision
(f), applicable where there is no existing civil penalty. While section 226(a) does not
provide for civil penalties, section 226.3 provides civil penalties for a violation of section
226(a). Thus, her PAGA claim would fall under subdivision (a) of section 2699.2
Federal courts disagree whether subdivision (a) or subdivision (f) of section 2699 applies
where the allegation is the failure to provide adequate wage statements. Some courts
have read section 226.3 to limit civil penalties to only those instances where the employer

2 The significance of whether subdivision (a) or subdivision (f) of section 2699 is the
applicable PAGA statute is amount of the penalty.

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failed to provide any wage statement or to keep records. (York v. Starbucks Corp.
(C.D.Cal., Nov. 1, 2012, No. CV 08-07919 GAF) 2012 U.S. Dist. Lexis 190239, at pp.
*11-12; Fleming v. Covidien, Inc. (C.D.Cal., Aug. 12, 2011, No. ED CV-10-01487 RGK)
2011 U.S. Dist. Lexis 154590, at p. *7.) 3 We find more persuasive a decision that found
section 226.3 sets out a civil penalty for all violations of section 226. (Culley v. Lincare,
Inc. (E.D.Cal. 2017) 236 F.Supp.3d 1184, 1194.)
In construing a statute, we consider “the object to be achieved and the evil to be
prevented by the legislation.” (Harris v. Capital Growth Investors XIV (1991) 52 Cal.3d
1142, 1159, superseded on another point as noted in Munson v. Del Taco, Inc. (2009) 46
Cal.4th 661, 664.) Section 226(a) is intended to require employers to provide an
adequate wage statement, itemizing the information to be included, “to assist the
employee in determining whether he or she has been compensated properly.” (Soto v.
Motel 6 Operating, L.P. (2016) 4 Cal.App.5th 385, 390.) Section 226.3 provides the civil
penalty for failure to comply. In our view, LWDA would not be prohibited from seeking
civil penalties for a grossly inadequate wage statement simply because the employer did
provide a statement. Otherwise, the purpose of the statute would be thwarted.
In alleging a violation of section 226(a), Raines sought two different forms of
recovery. “[A] PAGA plaintiff can collect civil penalties set out in § 226.3, and, if the
wage statement violations create ‘injury as a result of a knowing and intentional’
violation, the statutory penalties set out in § 226(e)(1).” (Culley v. Lincare, Inc., supra,
236 F.Supp.3d at p. 1194.)

3 Although California Rules of Court, rule 8.1115 generally does not permit citation of
unpublished California cases, it does not prohibit citation of unpublished federal cases.
(Cal. Rules of Court, rule 8.1115; Farm Raised Salmon Cases (2008) 42 Cal.4th 1077,
1096, fn. 18.)

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 We turn now to whether summary adjudication in favor of Coastal Pacific was
proper as to either Raines’s individual claim for statutory penalties or her representative
(PAGA) claim for civil penalties from Coastal Pacific for its failure to provide accurate
wage statements.
II
Injury under Section 226(e)
Raines contends the trial court erred in granting summary adjudication on her
individual claim for statutory penalties under section 226(e) for the failure to provide an
accurate wage statement, specifically the failure to provide the hourly overtime rate. She
contends there are triable issues of fact as to whether she suffered injury as well as
whether Coastal Pacific’s failure was knowing and intentional.
Section 226(e) permits “[a]n employee suffering injury as a result of a knowing
and intentional failure by an employer to comply with subdivision (a)” to recover the
greater of actual damages or statutory penalties. “An employee is deemed to suffer
injury” if the employer fails to provide accurate and complete information of the hourly
rate, required by item (9), and “the employee cannot promptly and easily determine from
the wage statement alone” the applicable hourly rate. (§ 226(e)(2)(B).) The statute
defines “promptly and easily determine” to mean “a reasonable person would be able to
readily ascertain the information without reference to other documents or information.”
(§ 226(e)(2)(C).)
For purposes of section 226(e), a plaintiff is “injured” “if the accuracy of any of
the items enumerated in § 226(a) [including the hourly rate] cannot be ascertained from
the four corners of the wage statement.” (Ovieda v. Sodexo Operations, LLC (C.D.Cal.,
Oct. 3, 2013, No. CV 12-1750-GHK) 2013 WL 12122413 at p. *3.) An actual injury is
shown where “there is a need for both additional documentation and additional
mathematical calculations in order to determine whether Plaintiffs were correctly paid
and what they may be owed.” (Reinhardt v. Gemini Motor Transport (E.D.Cal. 2012)

9
879 F.Supp.2d 1138, 1142.) In contrast, where the deficiency in the wage statement
could be corrected by “simple math,” there is no actual injury. (Price v. Starbucks Corp.
(2011) 192 Cal.App.4th 1136, 1143.)
In support of its motion for summary judgment or summary adjudication, Coastal
Pacific provided excerpts of Raines’s deposition. In her deposition, Raines testified her
wage statements showed when she worked overtime and the amount she was paid for
overtime. She could not normally do division in her head, but she knew how to use a
calculator to perform division. Coastal Pacific also provided a sample wage statement for
Raines. It showed that for the pay period of October 27, 2013, through November 2,
2013, Raines worked 1.5 hours of overtime and was paid $34.94. Dividing 34.94 by 1.5
provides the hourly rate for overtime of $23.29. Raines offered no evidence to dispute
these facts. “[W]here relevant facts are not in dispute, questions of fact may be decided
as a matter of law in a summary judgment proceeding.” (Wang v. Nibbelink (2016) 4
Cal.App.5th 1, 28.)
Raines contends it cannot be said as a matter of law that a reasonable person can
“readily ascertain” the hourly rate for overtime. This is so, Raines argues, because
determining the overtime hourly rate “presents a relatively complex mathematical
problem that surely most people could not readily do in their heads.” The calculation
would require the use of a calculator.
We reject this argument. Here, one can determine the hourly overtime rate “from
the wage statement alone.” (§ 226(e)(2)(B).) It can be “promptly and easily” determined
by simple arithmetic. (Ibid.) The mathematical operation required is division, which is
taught in grade school. Although many people cannot perform the calculation in their
heads, it can be easily performed by use of a pencil and paper or a calculator; no
additional documents or information are necessary. (§ 226(e)(2)(C).)

10
 Since Raines could not show a triable issue of fact as to the requisite injury, we,
like the trial court, need not determine whether there was a triable issue of fact as to
whether Coastal Pacific’s failure to provide the hourly rate for overtime was knowing and
intentional.
The trial court did not err in granting summary adjudication in favor of Coastal
Pacific on Raines’s individual claim for statutory penalties under section 226(e).
III
Whether Injury is Required for PAGA Claim
The trial court granted summary adjudication on Raines’s PAGA claim because it
found Raines was required to show injury for that representative claim as well as for the
section 226(e) claim. Raines repeats her earlier contention that there is a triable issue of
fact as to injury, and further contends that even if she cannot establish injury, injury is not
required for the PAGA claim. Since we have rejected the first point, we now address the
second.
Whether a PAGA claim for a violation of section 226(a) requires the same
showing of injury as an individual claim for statutory penalties under section 226(e) is a
question of statutory interpretation that we review de novo. (Bruns v. E-Commerce
Exchange, Inc. (2011) 51 Cal.4th 717, 724.)
Courts have reached different conclusions on this question. Two federal cases
have found a PAGA claim based on violation of section 226 fails when a plaintiff has
failed to establish the elements of section 226(e), including injury. These cases have
labeled the PAGA claim “derivative,” but provide no further analysis on the issue.
(Green v. Lawrence Serv. Co. (C.D.Cal. 2013 No. LA CV12-06155 JAK) 2013 U.S. Dist.
Lexis 109270, at pp. *41-43; Elliot v. Spherion Pac. Work, LLC (C.D.Cal. 2008) 572
F.Supp.2d 1169, 1181-1182 (Elliot).)

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 In contrast, in McKenzie v. Federal Express Corp. (C.D. Cal 2011) 765 F.Supp.2d
1222 (McKenzie), at page 1232, the district court found recovery under PAGA for a
violation of section 226(a) did not require proving an injury under section 226(e). The
court reasoned, “PAGA does not contain any language indicating that injury within the
meaning of Labor Code section 226(e) must be shown.” (McKenzie, at pp. 1231-1232.)
The court relied on Lopez v. G.A.T. Airline Ground Support, Inc. (S.D.Cal., July 19,
2010, No. 09-CV-2268-IEG) 2010 U.S. Dist. Lexis 73029, which found that because
section 226 does not provide a penalty, penalties under section 2699, subdivision (f) are
available for a violation of section 226(a).4 The McKenzie court reasoned that: (1) the
plaintiff sought recovery under section 2699, subdivision (f); (2) section 2699.3 provides
that such a civil action requires a violation of one of the provisions listed under section
2699.5; and (3) section 2699.5 listed subdivision (a) of section 226, but not subdivision
(e). Therefore, the court concluded that to recover a PAGA penalty, one need only prove
a violation of subdivision (a) of section 226, not subdivision (e) with its injury
requirement. (McKenzie, at p. 1232.)5
Other federal courts have followed McKenzie on this point. (Willner v. Manpower
Inc. (N.D.Cal. 2014) 35 F.Supp.3d 1116, 1136; Aguirre v. Genesis Logistics (C.D.Cal.,

4 We do not find Lopez v. G.A.T. Airline Ground Support persuasive on the issue before
us. It did not consider subdivision (e) of section 226 and its injury requirement and the
court found a violation of section 226(a) by relying on case law that predates the adoption
of subdivision (e).
5 The second portion of the McKenzie court’s analysis is incorrect. Section 2699.3 sets
forth the notice requirements for a PAGA action. There are different requirements
depending on the type of labor law violation. Subdivision (a) of section 2699.3 speaks to
the requirements for noncurable violations, those set forth in section 2699.5.
Subdivisions (b) and (c) set forth the requirements for other violations. Thus, PAGA
actions are not limited to the violations set forth in section 2699.5. While we recognize
this error in McKenzie’s analysis, we do not believe the error affects the soundness of its
conclusion.

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July 3, 2013, No. SACV 12-00687-JVS) 2013 U.S. Dist. Lexis 189815, at p. *28; York v.
Starbucks Corp., supra, 2012 U.S. Dist. LEXIS 190239, at pp. *11-12.)
After briefing in this case was complete, Division 1 of the First District addressed
the question of whether the requirements of section 226(e) applied to a PAGA claim for a
violation of section 226(a) in Lopez v. Friant & Associates, LLC (2017) 15 Cal.App.5th
773 (Lopez). The parties provided us with supplemental briefs addressing Lopez.
In Lopez, the plaintiff filed suit alleging a single cause of action, a PAGA claim
for failure to include the last four digits of the employee’s social security number or an
employee identification number on the itemized wage statement, as required by section
226(a)(7). (Lopez, supra, 15 Cal.App.4th at p. 776.) The defendant employer moved for
summary judgment contending the plaintiff had not shown injury from a knowing and
intentional violation. The trial court granted the motion, finding no triable issue of fact as
to whether the violation was knowing and intentional; the court did not address injury.
(Id. at p. 777.)
The appellate court reversed, holding “a plaintiff seeking civil penalties under
PAGA for a violation of section 226(a) does not have to satisfy the ‘injury’ and ‘knowing
and intentional’ requirements of section 226(e)(1).” (Lopez, supra, 15 Cal.App.4th at p.
788.) The court began its analysis with the plain language of the applicable statutes. It
reasoned that PAGA was concerned only with civil penalties, while section 226(e)
provided for damages or statutory penalties. (Lopez, at p. 780.) Case law has
distinguished between statutory penalties and civil penalties. “The civil penalties
recovered on behalf of the state under the PAGA are distinct from the statutory damages
to which employees may be entitled in their individual capacities.” (Iskanian, supra, 59
Cal.4th at p. 381.) Only penalties that are expressly denominated civil penalties are
subject to PAGA. (Lopez, at p. 781, citing Villacres v. ABM Industries Inc. (2010) 189
Cal.App.4th 562, 579 [“The PAGA is limited to the recovery of civil penalties.”]) The
court found support for its plain language analysis in the legislative history that showed

13
section 226(e) authorized a private right of action for statutory damages or penalties and
not a civil penalty. (Lopez, at pp. 781-784.)
The Lopez court noted its conclusion was consistent with that of many federal
cases, citing McKenzie, supra, 765 F.Supp.2d 1222; Willner v. Manpower, Inc., supra, 35
F.Supp.3d 1116; Gaasterland v. Ameriprise Fin. Serv., Inc. (N.D.Cal., Sept. 15, 2016,
No. 16-CV-03367-LHK) 2016 U.S. Dist. Lexis 126648 [§ 226(e) does not apply to
PAGA claim for violation of § 226(a)]; Stafford v. Brink’s, Incorporated (C.D.Cal., Aug.
5, 2014, No. CV-14-1352-MWF) 2014 U.S. Dist. Lexis 194677 [PAGA claim based on
violation of § 226 does not require showing of knowing and intentional injury];
Burnham v. Ruan Transportation (C.D.Cal., Aug. 30, 2013, No. SACV 12-0688 AG)
2013 U.S. Dist. Lexis 198505 [plaintiffs must prove injury to recover damages under
§ 226, but not to recover PAGA penalties].) (Lopez, supra, 15 Cal.App.4th at p. 785.)
We agree with the conclusion of Lopez and the federal cases it cites that the
requirements for a section 226(e) claim do not apply to a PAGA claim for a violation of
section 226(a). In this context, PAGA is concerned with collecting civil penalties for the
violation of section 226(a), not the damages or statutory penalties provided for in section
226(e). As we explain, post, we find additional support for this conclusion beyond the
reasoning of Lopez.
Coastal Pacific urges this court not to follow Lopez. First, it contends the issue of
whether injury was required for a PAGA claim was not before the trial court in that case,
as the Lopez trial court rested its decision on only the knowing and intentional
requirement of section 226(e) and the Lopez appellate court needed to address only that
issue to resolve the appeal. We see no principled reason to distinguish between the two
different requirements of section 226(e) of injury and a knowing and intentional violation
and Coastal Pacific offers none. We agree with the Lopez court that its analysis applies
equally to both requirements.

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 Second, Coastal Pacific faults the Lopez decision for failing to discuss the federal
cases that found there was no violation of section 226(a) without an injury. The trial
court in the instant case followed Green v. Lawrence Serv. Co., supra, 2013 U.S. Dist.
Lexis 109270 and Elliot, supra, 572 F.Supp.2d 1169, which found injury was required
due to the “derivative” nature of a PAGA claim. The trial court summarized these cases
and Price v. Starbucks Corp., supra, 192 Cal.App.4th 1136: “In effect, these courts are
interpreting and applying the statute to say that ‘no injury’ amounts to ‘no violation.’ ”
We disagree that “ ‘no injury’ amounts to ‘no violation.’ ” A PAGA claim for a
violation of section 226(a) seeks to recover civil penalties. Those civil penalties are
provided for in section 226.3. That section provides: “Any employer who violates
subdivision (a) of Section 226 shall be subject to a civil penalty in the amount of two
hundred fifty dollars ($250) per employee per violation in an initial citation and one
thousand dollars ($1,000) per employee for each violation in a subsequent citation, for
which the employer fails to provide the employee a wage deduction statement or fails to
keep the records required in subdivision (a) of Section 226. The civil penalties provided
for in this section are in addition to any other penalty provided by law. In enforcing this
section, the Labor Commissioner shall take into consideration whether the violation was
inadvertent, and in his or her discretion, may decide not to penalize an employer for a
first violation when that violation was due to a clerical error or inadvertent mistake.”
Section 226.3 permits the Labor Commissioner to take into consideration whether
the section 226(a) violation was inadvertent. Under section 226(e), an employer may
bring an individual suit for damages or statutory penalties only for “a knowing and
intentional failure by an employer to comply with subdivision (a).” The civil penalty has
no “knowing and intentional” requirement because inadvertence is only a factor to
consider, not a disqualifying condition. Because section 226.3 clearly does not include
the knowing and intentional requirement of section 226(e), there is no reasoned basis to
import the injury requirement of section 226(e) to the civil penalty. We agree with Green

15
and Elliot that a PAGA claim is derivative, but it is derivative of section 226(a) and
section 266.3, not section 226(e).
Both the trial court and Coastal Pacific justify their interpretation by questioning
why the Legislature would permit civil penalties for a violation of section 226(a) that did
not cause injury, when it does not permit damages (or statutory penalties) in such a case.
But damages and civil penalties have different purposes; these different purposes may
well explain the Legislature’s reasoning. Damages are intended to be compensatory, to
make one whole. (See Civ. Code, § 3281.) Accordingly, there must be an injury to
compensate. On the other hand, “Civil penalties, like punitive damages, are intended to
punish the wrongdoer and to deter future misconduct.” (People v. First Federal Credit
Corp. (2002) 104 Cal.App.4th 721, 732.) An act may be wrongful and subject to civil
penalties even if it does not result in injury.
Further, we note that a trial court has discretion in awarding civil penalties and
may reduce the award for technical violations that cause no injury. “In any action by an
aggrieved employee seeking recovery of a civil penalty available under subdivision (a) or
(f), a court may award a lesser amount than the maximum civil penalty amount specified
by this part if, based on the facts and circumstances of the particular case, to do otherwise
would result in an award that is unjust, arbitrary and oppressive, or confiscatory.”
(§ 2699, subd. (e)(2); see Thurman v. Bayshore Transit Management, Inc. (2012) 203
Cal.App.4th 1112, 1135-1136 [no abuse of discretion to reduce penalty by 30 percent].)
The court is also directed to consider whether the violation was inadvertent in assessing
penalties. (§§ 226.3; 2699, subd. (e)(1); Heritage Residential Care, Inc. v. Division of
Labor Standards Enforcement (2011) 192 Cal.App.4th 75, 82 [§ 226.3 “envisions a two-
part analysis: first, a mandatory consideration of whether the violation was inadvertent;
second, if inadvertence is found, a discretionary decision about whether to penalize a first
violation”].)

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 At oral argument, Coastal Pacific cited to two new cases that it asserted supported
its position that a derivative PAGA claim requires injury.6 Coastal Pacific contends that
Kim v. Reins Int’l California, Inc. (2017) 18 Cal.App.5th 1052, review granted March 20,
2018 (Kim) and Harris v. Best Buy Stores, L.P. (N.D.Cal., Feb. 20, 2018, No. 17-cv-
00446-HSG) 2018 U.S. Dist. Lexis 28079 (Harris) hold that when an individual claim of
a Labor Code violation fails, the derivative PAGA claim must fail as well. We find Kim
and Harris speak to the issue of standing to bring a PAGA claim and thus are inapposite
here.
Under PAGA, an “aggrieved employee” may bring suit for civil penalties for
Labor Code violations. (§ 2699, subd. (a).) An “aggrieved employee” is any person
employed by the alleged violator and against whom an alleged violation has been
committed. (Id., subd. (c).) In both Kim and Harris, the PAGA claim was dismissed
because the plaintiff was not an “aggrieved employee”; no Labor Code violation had
been committed against him. In Kim, plaintiff had settled and voluntarily dismissed his
wage and hour claim; the court held after a voluntary dismissal, Kim was no longer an
“aggrieved employee.” (Kim, supra, 18 Cal.App.5th at p. 1059.) In Harris, plaintiff’s
overtime wage claim had been dismissed with prejudice in a prior action. (Harris, supra,
2018 U.S. Dist. Lexis 28079, at p. *28.) Both cases concern the need for a Labor Code
violation, not whether the employee suffered “injury” under section 226(e)(2)(B). Here,
it is undisputed that a Labor Code violation (failure to provide overtime rate) had been
committed against Raines.
Finally, Coastal Pacific argues the Legislature never intended to permit PAGA
plaintiffs to “slice up the Labor Code.” It argues that if section 226(a) is separated from
section 226(e) for PAGA claims, then PAGA penalties could be recovered from

6 Coastal Pacific did not supply this court (and opposing counsel) with notice of the new
authority as provided for in California Rules of Court, rule 8.254.

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employers excluded from such penalties in subdivisions (d) (babysitters and the like) and
(i) (governmental entities) of section 226 because PAGA does not mention those
subdivisions. We find no merit in this argument. Both subdivisions (d) and (i) begin:
“This section does not apply . . . .” Thus, employers described in these subdivisions
cannot violate section 226(a); these subdivisions are exceptions thereto. By contrast,
section 226(e) does not provide an exception to section 226(a); instead, it provides a
private right of action for damages or statutory penalties, as long as certain conditions
(injury and a knowing and intentional violation) are met.
Because the trial court incorrectly found an employee must suffer an injury in
order to bring a PAGA claim, it erred in granting summary adjudication on Raines’s
PAGA claim.
IV
Alleged Procedural Errors
Raines contends the trial court erred procedurally in reversing its previous order
denying Coastal Pacific’s motion for summary adjudication on the labor law violations.
Raines contends the court was required to solicit briefing and hold a hearing before
changing its order. Instead, according to Raines, the court improperly granted an
untimely motion for reconsideration.
Raines relies on Le Francois v. Goel (2005) 35 Cal.4th 1094 (Le Francois), a case
she claims has “circumstances nearly identical to those present in this matter.” In Le
Francois, the trial court denied defendants’ motion for summary judgment. Over a year
later, individual defendants filed a new motion for summary judgment based on the same
grounds as the first. The motion was transferred to another judge who granted it. (Id. at
p. 1097.) Our Supreme Court held the trial court erred in granting the second motion.
(Id. at p. 1109.) Le Francois interpreted the procedural statutes “as imposing a limitation
on the parties’ ability to file repetitive motions, but not on the court’s authority to
reconsider its prior interim rulings on its own motion.” (Id. at p. 1105.) “Unless the

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requirements of [Code of Civil Procedure] section 437c, subdivision (f)(2), or 1008 are
satisfied, any action to reconsider a prior interim order must formally begin with the court
on its own motion. To be fair to the parties, if the court is seriously concerned that one of
its prior interim rulings might have been erroneous, and thus that it might want to
reconsider that ruling on its own motion—something we think will happen rather
rarely—it should inform the parties of this concern, solicit briefing, and hold a hearing.”
(Id. at p. 1108.)
Here, the judgment indicates the trial court reversed its prior order on the motion
for summary judgment or summary adjudication “on its own motion.” Le Francois holds
the court had inherent authority to do so. (Le Francois, supra, 35 Cal.4th at p. 1105.)
This change of mind came after the parties filed trial briefs and stipulated that the court
should decide the legal question of whether a PAGA claim required an injury. We need
not decide if the court provided proper notice and a hearing before changing its ruling
because Raines cannot show any prejudice. A trial court’s judgment may not be set aside
for procedural error unless the error has resulted in a miscarriage of justice. (Cal. Const.,
art. VI, § 13.) We have independently reviewed the court’s rulings, after full briefing by
the parties and an opportunity to be heard, both as to the individual section 226(a) claims
and the representative PAGA claim. Therefore, any error as to proper notice or hearing
has been cured.
Raines argues we should not require a miscarriage of justice because Le Francois
did not. There, the dissent argued the case should be affirmed due to lack of prejudice
because the trial court had authority to grant the summary judgment motion on its own
motion. (Le Francois, supra, 35 Cal.4th at pp. 1109-1110 (conc. & dis. opn. of Kennard,
J.).) The majority rejected this argument because the plaintiff had no notice of the
reconsideration and it was unknown what response he might have made. (Id. at p. 1109,
fn. 6.) The circumstances here are different. We have decided the same issues that were

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considered by the trial court in the motion for summary adjudication; the Le Francois
court did not.
DISPOSITION
The judgment is reversed as to the PAGA claim only. In all other respects, the
judgment is affirmed. The parties shall bear their own costs on appeal. (See Cal. Rules
of Court, rule 8.278(a)(3).)

/s/
Duarte, J.

We concur:

/s/
Raye, P. J.

/s/
Renner, J.

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