Since our last coverage of “headless PAGA lawsuits”—i.e., lawsuits in which a plaintiff disavows his individual PAGA claim and opts to pursue the claim only on behalf of others—significant developments have further complicated the Private Attorneys General Act (“PAGA”) landscape. In Leeper v. Shipt, Inc., 107 Cal.App.5th 1001 (2024), the California Court of Appeal (Second District) rejected the so-called “headless” PAGA theory and held that every PAGA action must include both an individual and a non-individual claim even if the plaintiff disavows their own claim, thereby preventing plaintiffs from using this strategy to avoid arbitration. A conflicting decision was issued by another appellate court (the Fourth District) in Rodriguez v. Packers Sanitation Servs. LTD., LLC, 109 Cal.App.5th 69 (2025), reh’g denied (Mar. 19, 2025). This disagreement between the two appellate decisions has led to considerable uncertainty for litigants facing pre-June 2024 PAGA lawsuits, with the California Supreme Court now stepping in to provide much needed guidance.
The Heart of the Dispute: PAGA “Individual” vs. “Non-Individual” Claims
The fundamental issue that the California Supreme Court will address in Leeper is whether a court can compel arbitration of individual PAGA claims (based on the pre-June 2024 version of the PAGA statute) when a plaintiff claims to assert only “non-individual” (i.e., representative-only) claims. Central to this question is whether Leeper or Rodriquez is controlling.
In Leeper v. Shipt, Inc., the appellate court held that every PAGA action necessarily includes both individual and non-individual components, with the individual component being arbitrable. The court in Leeper premised its decision on a plain reading of the PAGA statute, which expressly requires a plaintiff to bring their PAGA action “on behalf of himself or herself and other current or former employees.”[1] Once the individual claim is compelled to arbitration, per Leeper,the representative component is stayed pending the outcome of arbitration.
In Rodriguez v. Packers Sanitation Services LTD. LLC, the court conducted a very limited analysis of the issue. Rodriguez held that courts must look to the face of the complaint and if the lawsuit lacks individual PAGA allegations, the court is unable to order arbitration of claims not pled. While the court explicitly declined to answer whether a plaintiff may bring a PAGA action with only “non-individual” PAGA claims, it did note that a pleading lacking individual PAGA claims may be defective and subject to a motion to strike—suggesting, as Leeper held, that in order to bring a lawsuit seeking PAGA penalties, the named plaintiff must pursue both individual and non-individual claims. Rodriguez appears to be suggesting that defendants faced with a headless PAGA suit file simultaneous motions to compel arbitration and to strike defective pleadings.
The Current State: Deep Division and California Supreme Court Review[2]
The conflicting conclusions in Leeper and Rodriguez have deeply divided both the employment bar and the California appellate courts. Reflecting the significance of this division, on April 16, 2025, the California Supreme Court took the unusual step of ordering review of Leeper on its own motion.[3] The California Supreme Court noted that while Leeper remains under review, it may be cited for its persuasive value and to establish the existence of a conflict in authority, thereby allowing trial courts to exercise discretion in choosing between conflicting decisions. Subsequently, on May 14, 2025, the California Supreme Court granted review of Rodriguez, with further action deferred pending consideration and disposition of the related issues in Leeper.[4] As a result, Rodriguez currently has no binding or precedential effect and, like Leeper, may be cited only for its persuasive value and to establish the existence of a conflict in authority.[5]
Several appeals involving the headless PAGA issue raised in Leeper and Rodriguez are pending throughout the state and awaiting final word from the California Supreme Court.
Key Takeaways
For now, neither Leeper nor Rodriguez is binding authority, but both may be used as persuasive precedent or to demonstrate there is a conflict between the appellate courts on this issue. Plaintiffs who filed their notice with the Labor & Workforce Development Agency (“LWDA”) before June 19, 2024, and are attempting to bring a “headless” PAGA action in order to avoid arbitration, may theoretically invite motions to compel arbitration, motions to strike defective pleadings, or both, depending on which authority they cite to—potentially increasing complexity and costs of litigation for employers.
The ultimate resolution will come from the California Supreme Court, which is set to clarify whether all PAGA actions must necessarily include an individual component subject to arbitration. It remains to be seen whether in ruling on Leeper and Rodriquez, the Supreme Court will limit its findings to PAGA lawsuits based on a pre-June 2024 LWDA notice, or issue a broader decision that also addresses the post-June 2024 PAGA reforms (as previously reported in this blog post).
Given the continued uncertainty around PAGA litigation and arbitration agreements, employers should regularly review their employment arbitration agreements as we wait for the California Supreme Court to provide guidance on this issue.
FOOTNOTES
[1] Cal. Lab. Code § 2699(a) (emphasis added).
[2] All actions taken by the California Supreme Court on Leeper (S289305) and Rodriguez (S290182) can be monitored via the California Supreme Court Search Engine.
[3] Leeper v. Shipt, 566 P.3d 234 (Cal., 2025).
[4] Rodriguez v. Packers Sanitation Servs. Ltd., No. S290182, 2025 WL 1404550 (Cal. May 14, 2025).
[5] See Cal. Rules of Court, rules 8.1105, 8.1115, and Comment on rule 8.1115(e)(3).