Arbitration Agreements

Subscribe to Arbitration Agreements via RSS

When the California Supreme Court decided Iskanian v. CLS Transp. Los Angeles, LLC, 59 Cal. 4th 348 (2014), this June, some legal commentators assumed that employees could not waive pre-litigation claims under the Private Attorneys General Act (PAGA). Those assumptions may have been premature. As we noted here, at least one federal court refused to apply Iskanian forcing an employee’s individual PAGA claims…

Yesterday, the California Supreme Court issued its long-awaited decision in Iskanian v. CLS Transp. Los Angeles, LLC, upholding class action waivers in employment arbitration agreements. This means that the U.S. Supreme Court’s 2011 opinion in AT&T Mobility LLC v. Concepcion is to be given full force and effect in the employment setting in California. That said, however, Iskanian distinguishes the right of an employee…

On January 17, 2014, the National Labor Relations Board Judge Lisa D. Thompson concluded that an agreement that did not prohibit class or collective action still violated Section 8(a)(1) of the National Labor Relations Act because the Agreement “interfere[d], restrain[ed], or coerce[d]” plaintiff and other similarly situated employees’ “substantive rights to file classwide litigation.”  This ruling stems from Cunningham v. Leslie’s Poolmart, Inc., an …

Horton Hears an Employer Victory

Last December, the Fifth Circuit issued its long-awaited decision in D.R. Horton, Inc. v. NLRB, holding that employers may require employees to sign arbitration agreements categorically waiving the right to pursue employment claims in a collective or class action. In doing so, the Fifth Circuit’s rejected the NLRB’s opinion that such agreements violate employees’ right under Section 7 of…

In Chavarria v. Ralphs Grocery Co., No. 11-56673, 2013 WL 5779332 (9th Cir. Oct. 28, 2013), the plaintiff, a former deli clerk, brought a class action against Ralphs for various alleged wage and hour violations of the California Labor Code.  As a condition of employment, Chavarria signed an arbitration agreement containing a class action waiver.  Ralphs filed a motion to compel arbitration.

The U.S.…

In a post last week, we noted a recent trend of federal courts strongly enforcing employment arbitration agreements under the Federal Arbitration Act (“FAA”). That trend continues in Richards v. Ernst & Young, LLP, Case No. 11-17530 (9th Cir. Aug. 21, 2013), which holds that a defendant’s pretrial participation in litigation does not, absent prejudice to the plaintiff, necessarily waive the defendant’s right to…

Two recent decisions from the U.S. Court of Appeals for the Second Circuit have reaffirmed the enforceability of employment-related arbitration agreements containing class action waivers. In Sutherland v. Ernst & Young and Raniere v. Citigroup, Inc. the Second Circuit held that the Federal Arbitration Act (FAA) requires courts to enforce a valid agreement to arbitrate even where the relevant substantive law – here, the Fair…

Flores v. West Covina Auto Group, 2013 WL 139200 (Cal. App. Jan. 11, 2013)

Israel Flores and Andrea Naasz sued West Covina Toyota (WCT) and Toyota Motor Sales for selling them a “lemon,” alleging both individual and class action claims, including claims for violations of the Consumer Legal Remedies Act (CLRA).  WCT filed a motion to compel arbitration and enforce the class action waiver contained…

Baltazar v. Forever 21, Inc., 2012 Cal. App. LEXIS 1292 (Dec. 20, 2012)

Maribel Baltazar sued her former employer, Forever 21, Inc., alleging she was constructively discharged and subjected to discrimination and harassment based on her race and sex.  In response, Forever 21 filed a motion to compel arbitration pursuant to an arbitration agreement between Baltazar and Forever 21.  The trial court denied the…

Truly Nolen of America v. Superior Court, 2012 WL 3222211 (Aug. 13, 2012)

California law involving classwide wage-and-hour arbitration continues to evolve in the aftermath of the United States Supreme Court’s landmark decision in AT&T Mobility LLC v. Concepcion, 131 S. Ct. 1740 (2011), which generally prohibits states from requiring additional due process guarantees (not required under the Federal Arbitration Act) for enforcing arbitration agreements. (See our prior blog post here.) Since Concepcion, lawyers and jurists have called into question the continuing viability of Gentry v. Superior Court – in which the California Supreme Court delineated a four-factor test for invalidating class arbitration waivers – as well as other cases subjecting employment arbitration agreements to special (employee-friendly) rules. Some courts have continued to apply Gentry while others have declared it dead, holding that “[a] rule like the one in Gentry – requiring courts to determine whether to impose class arbitration on parties who contractually rejected it – cannot be considered consistent with [Concepcion’s] objective of enforcing arbitration agreements according to their terms.” See, e.g., Iskanian v. CLS Transp. Los Angeles, LLC, 206 Cal. App. 4th 949 (2012).

In its recent decision in Truly Nolen of America v. Superior Court, the California Court of Appeal gave a nod to Iskanian and other cases invalidating Gentry, but ultimately held that in the absence of an express or implied agreement among the parties regarding class arbitration, ordering the arbitration of non-waivable employment claims on a classwide basis was “questionable” though not erroneous, since this is a narrow issue on which the California Supreme Court has not yet opined. The plaintiffs, who worked as pest control technicians for Truly Nolen of America (“Truly Nolen”), alleged on behalf of themselves and other current and former employees that they had been misclassified as exempt from California’s stringent overtime pay requirements. Truly Nolen moved to compel arbitration of the plaintiffs’ claims based on an arbitration agreement between the parties which was silent on the issue of whether class claims would be arbitrated on an individual or classwide basis. The trial court, relying on Gentry, ordered classwide arbitration, over Truly Nolen’s objections.