Arbitration

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A recent decision by the Ninth Circuit reversed a district court’s denial of an employer’s motion to compel arbitration under the Federal Arbitration Act (“FAA”). This decision is notable because the applicable dispute resolution policy, outlining the terms of arbitration, was contained within the company’s policy manual and detached from the employee’s signed acknowledgment of receipt of the manual. The Ninth Circuit reversed the district court’s decision on the grounds the language of the employer’s dispute resolution policy, separately outlined within the company’s policy manual, expressly indicated a waiver of the right to a judicial forum for civil rights claims such that the employee “knowingly” agreed to arbitrate his Title VII claim. Michael Ashbey v. Archstone Property Management, Inc., No. 12-55912 (9th Cir., May 12, 2015).
Continue Reading Ninth Circuit Finds Plaintiff Knowingly Agreed to Arbitration of Title VII Claims

In a recent opinion affirming an arbitrator’s judgment in favor of an employer on various employment law claims, the California Court of Appeal held that an employee agreed to arbitrate all claims against her former employee when she signed an arbitration policy contained in an easy-to-read document distinct from any other document the she signed at the time of her hiring.  In doing so, the Court clarified important aspects of the test for enforcing an arbitration agreement signed by a company’s employees. 
Continue Reading California Appeals Court Affirms that Employee Signature Acknowledging Clear Arbitration Policy Makes Policy Binding

On February 27, 2015, the California Court of Appeal determined that arbitration could not be compelled in Securitas Security Services USA, Inc. v. Superior Court (Edwards). Securitas’ arbitration agreement contained a waiver provision, waiving both class actions and representative Private Attorney General Act (PAGA) actions. In addition to waiving these claims, the waiver provision expressly stated that the waiver could not be severed from the agreement. In a separate paragraph, the Agreement contained a general severability clause, providing that “in the event any portion of this Agreement is deemed unenforceable, the remainder of this Agreement will be enforceable. If the Class Action Waiver is deemed to be unenforceable, [the parties] agree that this Agreement is otherwise silent as to any party’s ability to bring a class, collective, or representative action in arbitration.”
Continue Reading No Arbitration if Invalid PAGA Waiver Cannot be Severed

On February 26, 2015, in Franco v. Arakelian Enterprises, Inc., Case No. B232583, the California Court of Appeal, Second Appellate District held that trial court proceedings on claims pursuant to the California Private Attorney General Act (“PAGA”) (Labor Code § 2698 et seq.) must be stayed pending individual arbitration of the underlying individual wage and hour claims (originally pled as classwide claims) pursuant to an arbitration agreement containing a classwide arbitration waiver.
Continue Reading California Court of Appeal Rules PAGA Claims Must Be Stayed Pending Outcome of Individual Arbitration on Underlying Individual Wage and Hour Claims

The battle over whether employees may waive the right to pursue claims under California’s Private Attorneys General Act (PAGA) in arbitration continues. The Supreme Court of the United States recently requested a response from ex-Bridgestone Retail Operations LLC employees to Bridgestone’s January 5, 2015 petition for a writ of certiorari challenging the California Supreme Court’s refusal to enforce an arbitration agreement waiving PAGA claims.
Continue Reading Enforceability of PAGA Waivers in Arbitration Agreements – The Battle Continues

The U.S. Supreme Court has declined to review the California Supreme Court’s decision that representative claims under the California Labor Code Private Attorneys General Act (“PAGA”) cannot be waived in employment arbitration agreements. Iskanian v. CLS Transp. Los Angeles, LLC, 59 Cal. 4th 348 (Cal. 2014), cert. denied, No. 14-341 (U.S. Jan. 20, 2015).

In Iskanian, the California Supreme Court ruled the Federal Arbitration Act (“FAA”) preempted California law disfavoring enforcement of a class action waiver in employment arbitration agreements. However, it also ruled the FAA did not preempt representative actions under PAGA. For additional information on Iskanian, please see our article, California High Court: Class Action Waivers in Arbitration Valid, But Waivers of Representative Actions under State Law Are Not.
Continue Reading California Supreme Court Decision Barring Waiver of Representative Claims is Left Intact by U.S. Supreme Court

A clause delegating to an arbitrator the authority to decide questions of an arbitration agreement’s enforceability was not unconscionable under California law, the California Court of Appeal has ruled. Malone v. Superior Court, No. B253891 (Cal. Ct. App. June 17, 2014). The Court affirmed an order enforcing the delegation clause and compelling arbitration. Significantly,…

An employer that petitioned to compel arbitration one year after the employee filed his employment-related complaint did not waive its right to arbitrate the complaint, the California Court of Appeal has ruled, confirming the burden of proving a party waived its right to arbitration is a heavy one. Gloster v. Sonic Automotive, Inc., No.…

A trial court lacked authority to rule on the enforceability of an arbitration agreement when the parties had contracted to delegate questions about the agreement’s enforceability to the arbitrator, the California Court of Appeal has ruled, reversing the denial of arbitration in a wrongful discharge action. Tiri v. Lucky Chances, Inc., No. A136675 (Cal.…

On April 21, 2014, a California Appellate Court held that an arbitration agreement is unconscionable and an employer cannot compel arbitration when the employer failed to translate the entirety of an English-language employment agreement containing an arbitration agreement, confidentiality clause, and enforceability provision for its Spanish-speaking employees.

In Esteban H. Carmona et al. v. Lincoln …