While the California Supreme Court has repeatedly upheld arbitration agreements with class action waivers (as they must under the Federal Arbitration Act), in a now infamous (and controversial) decision from 2014, the court held that an arbitration agreement could not include an enforceable waiver of an employee’s right to bring a “representative” action under the California Labor Code Private Attorneys General Act of 2004 (“PAGA”).  The court’s decision rested largely on the theory that a PAGA claim is filed by an employee on behalf of the State (and California has never agreed to arbitrate such claims) even though the employees and, especially, their lawyers generally recover more than the state doesSee Iskanian v. CLS Transp. Los Angeles, LLC, 59 Cal. 4th 348 (2014).

This is the reason we affectionately refer to PAGA as the “Prettymuch All Goes to the Attorneys” statute.

Over the years, the U.S. Supreme Court declined time and again to review the California Supreme Court’s decision despite repeated cert petitions—in 2015, 2017, and 2018.  (After all, it’s a big country, and the Supreme Court can only spend so much time extricating California from its many follies!)  As a result, there emerged a trend of plaintiffs’ lawyers completely abandoning class claims in favor of PAGA-only actions, which were believed to be forever immune from representative action waivers.  Until now, maybe…

On December 15, 2021, the U.S. Supreme Court granted cert in Viking River Cruises, Inc. v. Moriana, a 2020 California Court of Appeal decision that reaffirmed Iskanian’s holding.  In addition to Viking River, there were a number of other cert petitions challenging Iskanian’s holding before the Supreme Court.

While there is, of course, no way to predict the ultimate outcome in Viking River, many believe that recent changes in the composition of the Supreme Court as well as the Court’s generally pro-arbitration jurisprudence over the past decade (even among liberal justices) suggest that Iskanian’s days may be numbered.  And, although the Supreme Court has yet to schedule oral argument in the case, we should have an answer on Iskanian’s fate by the end of the current Supreme Court Term in late June 2022.

In the interim, Iskanian remains the law of this land.  But, employers who want to take immediate advantage of a potentially favorable outcome in Viking River should consult with counsel about what steps they should take right now.  Certainly, employers should reconsider whether to accept as a foregone conclusion that PAGA claims are and shall always be immune to arbitration/waiver agreements – there is now light at the end of that tunnel.  So, employers may consider filing motions to compel arbitration, relying on the Federal Arbitration Act; even if they are initially unsuccessful, Viking River likely will be decided before any appeal could be adjudicated.  Further, employers should closely reexamine their arbitration agreements to ensure that the language is sufficiently broad to take advantage of a favorable decision in Viking River.

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Photo of Tony Oncidi Tony Oncidi

Anthony J. Oncidi is the co-chair of the Labor & Employment Law Department and heads the West Coast Labor & Employment group in the firm’s Los Angeles office.

Tony represents employers and management in all aspects of labor relations and employment law, including…

Anthony J. Oncidi is the co-chair of the Labor & Employment Law Department and heads the West Coast Labor & Employment group in the firm’s Los Angeles office.

Tony represents employers and management in all aspects of labor relations and employment law, including litigation and preventive counseling, wage and hour matters, including class actions, wrongful termination, employee discipline, Title VII and the California Fair Employment and Housing Act, executive employment contract disputes, sexual harassment training and investigations, workplace violence, drug testing and privacy issues, Sarbanes-Oxley claims and employee raiding and trade secret protection. A substantial portion of Tony’s practice involves the defense of employers in large class actions, employment discrimination, harassment and wrongful termination litigation in state and federal court as well as arbitration proceedings, including FINRA matters.

Tony is recognized as a leading lawyer by such highly respected publications and organizations as the Los Angeles Daily JournalThe Hollywood Reporter, and Chambers USA, which gives him the highest possible rating (“Band 1”) for Labor & Employment.  According to Chambers USA, clients say Tony is “brilliant at what he does… He is even keeled, has a high emotional IQ, is a great legal writer and orator, and never gives up.” Other clients report:  “Tony has an outstanding reputation” and he is “smart, cost effective and appropriately aggressive.” Tony is hailed as “outstanding,” particularly for his “ability to merge top-shelf lawyerly advice with pragmatic business acumen.” He is highly respected in the industry, with other commentators lauding him as a “phenomenal strategist” and “one of the top employment litigators in the country.”

“Tony is the author of the treatise titled Employment Discrimination Depositions (Juris Pub’g 2020; www.jurispub.com), co-author of Proskauer on Privacy (PLI 2020), and, since 1990, has been a regular columnist for the official publication of the Labor and Employment Law Section of the State Bar of California and the Los Angeles Daily Journal.

Tony has been a featured guest on Fox 11 News and CBS News in Los Angeles. He has been interviewed and quoted by leading national media outlets such as The National Law JournalBloomberg News, The New York Times, and Newsweek and Time magazines. Tony is a frequent speaker on employment law topics for large and small groups of employers and their counsel, including the Society for Human Resource Management (“SHRM”), PIHRA, the National CLE Conference, National Business Institute, the Employment Round Table of Southern California (Board Member), the Council on Education in Management, the Institute for Corporate Counsel, the State Bar of California, the California Continuing Education of the Bar Program and the Los Angeles and Beverly Hills Bar Associations. He has testified as an expert witness regarding wage and hour issues as well as the California Fair Employment and Housing Act and has served as a faculty member of the National Employment Law Institute. He has served as an arbitrator in an employment discrimination matter.

Tony is an appointed Hearing Examiner for the Los Angeles Police Commission Board of Rights and has served as an Adjunct Professor of Law and a guest lecturer at USC Law School and a guest lecturer at UCLA Law School.

Photo of Philippe A. Lebel Philippe A. Lebel

Philippe (Phil) A. Lebel represents employers in all aspects of employment litigation, including wage and hour, wrongful termination, discrimination, harassment, retaliation, defamation, trade secrets, and breach of contract litigation, in both the single-plaintiff and class- and/or representative-action context, at both the trial and…

Philippe (Phil) A. Lebel represents employers in all aspects of employment litigation, including wage and hour, wrongful termination, discrimination, harassment, retaliation, defamation, trade secrets, and breach of contract litigation, in both the single-plaintiff and class- and/or representative-action context, at both the trial and appellate level, and before administrative agencies.

In addition to his litigation work, Phil regularly advises clients regarding compliance with federal, state and local employment laws, and assists a variety of companies and financial firms in evaluating labor and employment issues in connection with corporate transactions. Phil also has experience assisting employers with sensitive employee investigations and trainings.  Phil also represents employers in connection with labor law matters, such as labor arbitrations and proceedings before the National Labor Relations Board.

Phil has assisted clients in a wide array of sectors including in the biotech, education, entertainment, financial services, fitness, healthcare, high-tech, legal services, manufacturing, media, professional services, sports, and staffing industries, among others.

Phil regularly speaks on emerging issues for employers and has been published or quoted in Law360, the Daily JournalThe Hollywood ReporterBusiness Insurance, and SHRM.org regarding a variety of labor and employment law topics.

During college, Phil worked on political campaigns in Atlanta, Georgia and Birmingham, Alabama, and was an intern with the National Gay and Lesbian Task Force and the Gay and Lesbian Victory Fund. Phil is a former member of the Board of Directors of the AIDS Legal Referral Panel.