Connect with us

Business

Labor and business reach deal on law that addresses workplace abuses

Published

on

Labor and business reach deal on law that addresses workplace abuses

A deal has been struck between business and labor groups that puts an end to a long battle over a unique California law that allows workers who believe they have been victims of wage theft or other workplace abuses to sue employers not only for themselves but also for other workers.

Some of the largest companies in the state had banded together to place a measure on the November ballot that sought to effectively repeal the law, known as the Private Attorneys General Act, or PAGA. But backroom negotiations this month with unions and Democrats who opposed the initiative have resulted in a compromise that takes the initiative off the November ballot.

Instead, the deal reforms PAGA in a way that both businesses and workers say resolves problems with the law.

Concessions to business groups in the deal mainly involve changes to the penalty structure, making it more difficult for lawyers to simply demand a payout from a company. If companies can show they are trying to correct a violation, by giving back pay to workers and agreeing to change the offending practices, their penalties will be low.

“This package provides meaningful reforms that ensure workers continue to have a strong vehicle to get labor claims resolved, while also limiting the frivolous litigation that has cost employers billions,” said Jennifer Barrera, president and chief executive of the California Chamber of Commerce, according to a Tuesday news release from Gov. Gavin Newsom’s office announcing the deal.

Advertisement

Labor groups say the changes will help ensure that bad behavior by employers is halted, rather than simply awarding them a settlement and allowing a company to go back to problematic practices. The deal also allows workers to more quickly be paid back for wage theft and other violations.

“We want things fixed, changes that actually do help workers,” said Lorena Gonzalez, head of the California Labor Federation. “We are happy with the deal.”

The legislative deal would impose a time limit on lawsuits brought: Alleged violations must have occurred within the last year, and the workers bringing the claims must have personally experienced the alleged violations.

The deal also folds in labor-backed Assembly Bill 2288, introduced by Ash Kalra (D-San José), which aims to give PAGA more teeth by giving courts the power to order employers to correct violations.

Various labor organizations praised the deal in a news release, saying that it upholds core tenets of PAGA that aim to let workers hold abusive employers accountable for widespread wage theft, safety violations and misclassification of workers as independent contractors.

Advertisement

“PAGA is one of workers’ strongest protections against wage theft that drains at least $2 billion from workers’ pocketbooks each year. Today’s agreement protects this landmark law’s fundamental strength: workers’ right to access justice through our courts,” Alexandra Suh, co-president of the California Coalition for Worker Power and executive director of Koreatown Immigrant Workers Alliance, said in a statement.

The measure, initially set to appear on the California ballot in November, had been the culmination of long-standing efforts by corporate and industry groups to undo the law.

Business groups had criticized PAGA for causing what they described as a proliferation of frivolous and costly lawsuits that hurt small businesses and nonprofits. According to one study, the mounting lawsuits have cost businesses $10 billion during the last decade.

Under the PAGA law, workers would end up getting less money after a long legal process than if they had filed complaints through state agencies, groups backing the measure had said.

The law has helped workers sue companies such as Walmart, Uber Technologies and Google for workplace violations.

Advertisement

“There is near universal consensus that PAGA is broken and not working for workers or employers,” said Brian Maas, president of the California New Car Dealers Assn., according to a news release from businesses that sought to repeal PAGA. “We need sensible reforms to fix the broken system. We support this legislative reform and encourage lawmakers to swiftly pass the measure.”

Negotiations over PAGA came amid broader discussions around the 2024 ballot as well as budget conversations in Sacramento underway this month. The governor must sign a balanced state budget by June 30, and the deadline to put measures on the November ballot is June 27. Talks are ongoing over another business-backed ballot measure that would make it harder for the state to increase taxes.

Proposed changes to PAGA aim to encourage compliance with labor laws by capping penalties on employers that quickly take steps to fix bad practices. For employers that take steps to comply with the labor code before even receiving notice that they will be sued under PAGA, penalties are capped at 15% of the amount that would have otherwise been awarded. For employers that work to correct violations after receiving a PAGA notice, penalties are capped at 30%.

More of the penalty money would go to workers, with their allocated share increasing from 25% to 35%.

The reform would levy a new, higher penalty of $200 per pay period on employers that act “maliciously, fraudulently or oppressively” in violating labor laws.

Advertisement

Changes also aim to protect smaller companies by creating a process through which they can correct violations through the state labor department, to reduce their litigation costs.

“Small businesses throughout the state have been targeted by frivolous PAGA lawsuits for decades, even forcing some restaurants to shut down,” Jot Condie, president and CEO of the California Restaurant Assn., said in a statement. The reform package will “reduce shakedown lawsuits against small businesses.”

The Legislature will consider the reform legislation agreed to under the deal as early as this week. If the compromise is approved and signed by the governor, the coalition of businesses backing the initiative, called the Fix PAGA coalition, will remove its measure from the ballot.

Labor groups had raised an alarm about the ballot initiative in recent months, arguing that PAGA is a crucial tool for workers, since California struggles to enforce basic labor laws.

Although California has some of the toughest labor laws in the country, a study released last month by a team of researchers from UC San Francisco and Harvard University found that workers routinely experience abuses over pay, work schedules and other issues.

Advertisement

A recent audit of the California labor commissioner’s office found that claims of wage theft filed by California workers are routinely left in limbo for years by state investigators. The labor commissioner’s office would need to hire hundreds of additional staffers to effectively address a massive backlog.

Newsom’s office, as part of the deal, will pursue a budget-related bill to give the California Department of Industrial Relations the ability to expedite hiring in order to improve enforcement of wage theft claims.

Negotiations over the deal have lasted months and appeared to be going nowhere, but Newsom’s office, which was mediating the discussions, stepped in with a firmer hand this month. The deal came together over the last few weeks and was finalized on Monday, said a source familiar with the negotiations.

“Though we’ve successfully negotiated a dangerous measure off the November ballot — we can only hope that this deal encourages more employers to follow the law and pay their workers what they are owed. California’s worker advocate attorneys will continue to work vigilantly to ensure that they do,” said Kathryn Stebner, president of Consumer Attorneys of California.

Advertisement

Business

Angry Ferrari fans say the Italian company’s new EV is too Californian

Published

on

Angry Ferrari fans say the Italian company’s new EV is too Californian

Ferrari’s first-ever fully electric vehicle triggered some fans who said it looks more like an iPhone than an Italian supercar.

The $640,000 Ferrari Luce, which was unveiled on Wednesday, looks like a distant relative of many Apple products. It was built with the help of Jony Ive, the person who designed the look and feel of the Cupertino company’s iPhone, iPod and Macintosh through 2019.

“Legend has it that if you pull the Ferrari badge off the side of the new Luce you see an Apple logo underneath,” one user wrote on X.

A meme circulated portraying the Luce with iPhone applications photo-shopped onto the top, and another showing the car upside down and plugged into an iPhone charger.

To accommodate more batteries and seats, the new EV is bigger and boxier than most classic Ferraris. Ive’s design firm, LoveFrom, which he started in San-Francisco after leaving Apple, was brought in to try to meld the traditions of Ferrari with the new functionality and form allowed by a battery-powered engine.

Advertisement

In a marketing video, Ferrari’s chief design officer, Flavio Manzoni, said he sees the Luce “acting as a bridge between San Francisco and Maranello,” the northern Italian city where Ferrari is headquartered.

The four-door, five-seat car comes onto the scene at a difficult moment for electric vehicles, an industry that has been battered by President Trump’s policies.

Trump has cut EV incentives for manufacturers and customers, prompting several major automakers to move away from EV efforts and focus on gas-powered options.

A luxury EV effort from Sony and Honda, a high-tech vehicle dubbed Afeela, was shut down before it ever hit the road due to Honda paring back its EV offerings.

Legacy automakers such as Ferrari face a particularly difficult landscape for launching an EV, as die-hard fans are attached to traditional, gas-powered models.

Advertisement

Ferraris are known for roaring engines and bold, angular designs, a far cry from the smooth, rounded exterior of the Luce.

To be sure, aggressive redesigns often attract ridicule. The early electric Mustang models were shunned by some but have become popular.

One X user posted a meme with a photo of fictional Italian gangster Tony Soprano saying, “I don’t want any California bulls—.”

The online launch page for the car emphasizes that the Luce is “100% Ferrari.”

Still, Luca di Montezemolo, Ferrari’s former chairman, told reporters on Tuesday that the automaker is “risking the destruction of a legend.”

Advertisement

Ferrari shares have fallen about 8% since the launch of the Luce, signaling investors’ concerns that the car won’t resonate with customers.

Continue Reading

Business

Donald E. Newhouse, newspaper publisher and heir to media empire, dies at 96

Published

on

Donald E. Newhouse, newspaper publisher and heir to media empire, dies at 96

Donald E. Newhouse, president of one of the largest family-controlled publishing companies in the nation and a former board chairman of the Associated Press, died Tuesday. He was 96 and died at his home in New Jersey, his family said.

During his career, Newhouse served as president of the Star-Ledger in Newark, N.J., and head of Advance Publications’ newspaper group, which he navigated into the internet age.

“You reveled in his company. He filled you with energy and humor when you felt doubtful and weak,” said Anna Wintour, the global editorial director of Vogue and Conde Nast’s chief content officer.

“He was scrupulous about not interfering in editorial business, but if you turned to him for counsel, he invariably offered judicious advice,” she said in an obituary released Tuesday night by the Newhouse family.

Newhouse, who lived in New York, spent nearly 50 years overseeing the 35 newspapers of Advance Publications, the media business started by his late father, Samuel Irving Newhouse Sr., in 1922. His older brother, S.I. Newhouse Jr., was chairman of the company and oversaw Conde Nast magazines. He died in 2017.

Advertisement

Louis D. Boccardi, retired president and chief executive of the AP, said Newhouse was an extraordinary chairman for the cooperative.

“His voice was never the loudest in the room, but it was often the wisest,” Boccardi said. Newhouse was instinctively private, but behind that, Boccardi said, was a generous man, at home anywhere and curious about everything.

“He could come across as self-effacing and deferential, but in Don’s skilled hands those were qualities that made him an enormously strong and effective leader,” Boccardi said. “You don’t often see the adjective ‘warm’ attached to a titan of industry, but it applied to him.”

A man who didn’t chase the spotlight

Newhouse, born in 1929, was known for staying out of the public eye. A reporter once asked him to list the biggest chances he took in his career. The answer: “Inviting your questions.”

The usually reserved Newhouse did step into the spotlight when he took on the role of chairman of the Newspaper Assn. of America from 1993 to 1994 and then chairman of the AP board of directors from 1997 to 2002. He had served on the AP board for nine years before becoming its chairman.

Advertisement

“He was a smart and shrewd businessman but as thoughtful and kind a man as you’ll find. Being in his presence was always a joy,” said Doug Clifton, editor of one of Newhouse’s papers, the Plain Dealer in Cleveland, from 1999 to 2007.

Newhouse attended Syracuse University but never graduated, heading into the family’s newspaper business instead. He would regularly visit his newspapers but left the ultimate authority of running them to his publishers.

“Each of our newspapers operates independently, with publishers who are strong, who set policy for their individual organizations and who have the authority and responsibility of carrying out the policies they set,” he said in 1993 when taking over as chairman of the newspaper association.

Newhouse was known for spending money to make sure that papers got the best stories. Jim Willse, editor of the Star-Ledger in Newark, N.J., from 1995 until 2010, said he would give “us all the resources we needed to make the Ledger really special.” Willse said Newhouse loved newspapers and newspaper people.

“He especially enjoyed it when we’d have a story about some politician caught with his hand in the cookie jar, or a spicy feature about stuffed shirts behaving badly,” Willse said.

Advertisement

Newhouse’s philosophy of spending money to produce quality coverage and a hands-off approach toward his editors led to many successes, including multiple Pulitzers.

Many of those newspapers were able to thrive and remain profitable because they dominated their market, but Newhouse said he was very much aware of what he called the “dramatically changing media landscape” and how people get their news.

“The 15th-century revolution was epitomized by the printing of the Gutenberg Bible; ours by Ted Turner’s cable news network and by web-based news sites — news in real time from anywhere to everywhere,” he said in 2004 at the rededication of a communications school named after his father at Syracuse University.

Three years later, he told one of his papers, the Post-Standard of Syracuse, N.Y., that newspapers can survive “by producing content that is relevant, interesting, accurate and entertaining for newspapers and the internet.”

He steered through financial struggles

Yet the papers did ultimately struggle financially.

Advertisement

Advance was known in the industry for a pledge that employees who weren’t in a union would have jobs regardless of economic downturns or technological advances. In 2009, the company announced that the pledge would be withdrawn.

The company also moved away from daily publishing of several papers. In 2012, it announced that the Post-Standard; the Times-Picayune in New Orleans; the Patriot-News in Harrisburg, Penn.; and the Birmingham News, the Press-Register of Mobile and the Huntsville Times, all in Alabama, would cease daily publication and would only offer print editions on Wednesdays, Fridays and Sundays. Those changes were accompanied by hundreds of layoffs.

“His conservative approach left both the papers and its employees somewhat unprepared for the realities of the internet,” said Thomas Maier, who wrote a 1994 biography of the family.

Newhouse’s eldest son, Steven, spearheaded the company’s growth on the internet and on mobile devices. Steven Newhouse is currently co-president of Advance Publications.

“My dad spent his life in the newspaper business and was devoted to it, built it up and enjoyed many good years. When it became more challenging, he was first in line to work through, finding solutions to keep the local journalism franchise going,” he said.

Advertisement

Newhouse is also survived by another son, Michael, daughter Katherine Mele and grandchildren. His wife, Susan, died in 2015.

Mayerowitz writes for the Associated Press.

Continue Reading

Business

Child safety groups want FTC to investigate Roblox

Published

on

Child safety groups want FTC to investigate Roblox

Child safety advocates say the massively popular gaming platform Roblox could be bad for kids.

Fairplay and the National Center on Sexual Exploitation have requested the Federal Trade Commission to investigate if the games on Roblox are designed to make kids spend an unhealthy amount of time and money on their screens.

Roblox’s core users are young kids.

In a letter submitted to the FTC, the groups argue that Roblox’s engagement-maximizing design features, virtual currency system, and voice and text chat communication features are inappropriate for the platform’s user base and pose a substantial risk of harm.

“Alone and in combination, these three components capitalize on young users’ developmental vulnerabilities, exploit their desire for authentic self-expression, monetize their lack of impulse control, and turn in-game purchasing power into a form of social status,” the groups noted in the letter submitted Thursday to the FTC.

Advertisement

Roblox allows the purchase of virtual assets — clothing and dance moves, for example — which can only be purchased with the platform’s in-game currency, Robux. The platform obscures the exchange rate between dollars and the in-game currency, leaving young players to navigate a complex system of fluctuating conversion rates that increases the amount of real-world money players spend, according to the letter.

For instance, players can receive more Robux per dollar by purchasing larger bundles of currency or buying a “Roblox Premium” subscription, making it harder for children to perform financial calculations on how much they are spending on the platform.

The letter pointed to instances of unexpected Roblox charges, as one parent discovered that his daughter spent more than $5,000 on Roblox without understanding that she was spending real money.

The letter also outlined examples of “scarcity marketing” techniques that increase demand through limited-quantity assets and time-based reward to drive sales of virtual items, driving a false sense of urgency. Some see it as a strong-arm sales technique that should not be used on children:

“Items only available for a limited time encourage both rapid purchases and returning to the platform frequently — sometimes multiple times per day — to avoid missing out on items,” the letter said.

Advertisement

A Roblox spokesperson said that the company “strongly disputes these claims. Our platform is designed to provide a positive, healthy and enjoyable experience — we build for fun and connection, not short-term engagement. While no system can be perfect, we have a set of safeguards designed to support a safe and civil environment, and clear policies for game creators that require fair treatment of players.”

The groups pointed out that third-party games developed on Roblox are designed to profit from in-game purchases, and have “gambling-like” engagement mechanisms such as lootboxes, in which players cannot see what’s inside until after they have purchased it — and the items vary in value.

“We have clear policies prohibiting both actual and simulated gambling, and a set of rules governing how game creators can use gameplay mechanics like paid random items,” the Roblox spokesperson said. “Most games on Roblox are free to play and no one is required to purchase Robux. In the first quarter of 2026, only 1.4% of our 132 million daily active users were payers on the platform.”

The letter also alleged that the voice and text chat features on the platform expose children to sexual content, and argue that recent changes to age checks have not eliminated opportunities for adult-minor contact.

Advertisement
Continue Reading
Advertisement

Trending