A Business Group That May Thrive

Charles Crumpley
Editor and Publisher of the San Fernando Valley Business Journal

If you follow the business community, you’ve probably seen a number of single-issue groups form to fight a law or advocate for something. At first, enthusiasm is high, but then they seem to get tired or frustrated or overwhelmed, and the group falls apart.

To be honest, I kind of expected that would happen with a single-issue business group that formed in the Valley 1 ½ years ago to fight PAGA – or the Private Attorney General Act, a law that is hell on businesses.

Instead, that group appears to be growing. California Business and Industrial Alliance, or CABIA for short, reports its revenue has grown 61 percent over the last six months while membership is up 35 percent.

Why? For one thing, it has hold of a big issue – and one that’s getting bigger. PAGA lawsuits, once fairly rare, now are filed by the thousands each year.

With PAGA, there are two kinds of business operators: those who know nothing about it and don’t want to be bothered, and those who’ve been hit with a PAGA suit. The latter folks, typically gobsmacked, tend to be recruit material for CABIA.

And there’s another reason CABIA is growing: It employs tactics that get attention. Remember when Amazon was looking for a second headquarters? CABIA took out a full-page ad in USA Today saying, “Dear Amazon: Our weather is nice. Our business climate is not.”

CABIA has taken to shaming the lawyers who profit by filing PAGA lawsuits. CABIA members in December picketed the Ventura Boulevard law office of Kingsley & Kingsley in Encino because, CABIA claimed, Eric Kingsley is California’s second-most prolific filer of PAGA lawsuits. Tell me, when was the last time you saw a picket line with signs and bullhorns – manned by business operators?

These are the kinds of tactics that most take-the-high-road business groups eschew, but which seem to be working for CABIA and its enraged members.

CABIA was started by Tom Manzo, president of a Pacoima maker of steel door frames. Manzo was one of those who knew nothing about PAGA – until his company was hit with a PAGA suit. His sin? He allowed early-shift workers to delay their lunch break so they could eat with the later-shift workers because they wanted to. But that’s in violation of the state’s labor code, which mandates that worker must have a lunch break within 5 hours of beginning work. Normally, such a transgression might incur a small or no fine. But it cost his firm more than $1 million because it was filed under PAGA, which deputizes employees and their lawyers to enforce labor code violations – and they have no impulse to use discretion, as an attorney general might.

As long as the legislators do nothing to rein in PAGA – and the Valley’s own Adrin Nazarian and Robert Hertzberg have been asked but have done nothing – they’re giving CABIA the chance to be one of those rare startup business groups that continues growing.

Charles Crumpley is editor and publisher of the Business Journal. He can be reached at [email protected]

 

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