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. Ct. App. May 15, 2014).
Articles Discussing General Workplace Issues in California.
Arbitration, Confidentiality Agreement with Car Wash Workers was Unenforceable, California Court Rules
An arbitration and confidentiality agreement provided to car wash workers was unconscionable and unenforceable, the California Court of Appeal has ruled, denying arbitration in a class action for alleged California wage-hour law violations. Carmona v. Lincoln Millennium Car Wash, Inc., No. B248143 (Cal. Ct. App. May 9, 2014).
California Supreme Court Hears Arguments on Whether Discrimination Claim Barred if Employee Used Another’s Social Security Number When Applying for Position
The California Supreme Court recently heard oral arguments in an appeal brought by a former employee who claims the lower courts incorrectly determined that his disability discrimination claim was barred because he misappropriated someone else’s Social Security number to apply for the job.
California Court of Appeal Holds Employers Must Establish Interstate Commerce for FAA Preemption
In Lane v. Francis Capital Mgmt. LLC (Cal. Ct. App. Mar. 11, 2014), a California Court of Appeal held a former employee’s claim for unpaid wages were exempted from arbitration by California Labor Code section 229.
Arbitration Agreement Enforceable, Except as to Unpaid Wage Claim, California Court Rules
Even though American Arbitration Association rules were not attached to an arbitration agreement and the agreement did not expressly provide for discovery, the California Court of Appeal has found a former employee’s arbitration agreement with his employer was valid and reversed the trial court’s denial of the employer’s motion to compel arbitration as to the employee’s claims wrongful termination and Labor Code violations. Lane v. Francis Capital Mgmt. LLC, No. B245661 (Cal. Ct. App. Mar. 11, 2014). The Court ruled the former employee’s claim for unpaid wages, however, may proceed in court.
The De Minimis Doctrine Is Alive and Well in California
On March 7, 2014, in Troester v. Starbucks Corporation, the U.S. District Court for the Central District of California applied the de minimis doctrine and granted summary judgment to the employer in a putative class action seeking allegedly unpaid minimum and overtime wages, along with derivative penalties, for time spent after the plaintiff clocked out for the day.
Arbitration Agreement Not Unconscionable, California Court Orders Arbitration
Sending a former employee’s wrongful termination claim to an arbitrator, the California Court of Appeal has ruled that his employment arbitration agreement was not unconscionable and deserved to be enforced. Sanchez v. CarMax Auto Superstores of California, LLC, No. B244772 (Cal. Ct. App. Mar. 4, 2014). The Court found that the agreement’s limitations on discovery and on “just cause” terminations, among others, were not substantively unconscionable, and so reversed a lower court order denying arbitration.
Poisoning a Coworker is Outside the Scope of Employment, California Court Rules
A California Court of Appeal has ruled that a medical staffing company was not vicariously liable for its medical assistant who poisoned a coworker while on assignment at a hospital. Montague et al. v. AMN Healthcare, Inc., No. D063385 (Cal. Ct. App. Feb. 21, 2014). The Court found the medical assistant’s “highly unusual and startling” actions occurred outside the scope of her employment and affirmed summary judgment in favor of the staffing company.
University Entitled to Fee Award after Defending Meritless Discrimination Claim, California Court Rules
Finding an employee’s lawsuit under the California Fair Employment and Housing Act (“FEHA”) was “without merit[,] frivolous and vexatious,” the California Court of Appeal has affirmed an award of attorneys’ fees in the amount of $100,000 in favor of the employer. Robert v. Stanford Univ., No. H037514 (Cal. Ct. App. Feb. 25, 2014). The Court further ruled that the trial court was not required to issue a separate written opinion to support its ruling.
California Regulatory and Legislative Developments: The 2014 Session of the California Legislature
So far, as the second year of a two-year California legislative session, 2014 has been more noteworthy for what hasn’t happened, than for what has. The Legislature made no attempts to override any of the Governor’s 2013 end-of-session vetoes. Rather, legislators have re-introduced bills to try again to pass them and get the Governor’s signature, or to tweak previous unsuccessful proposals in an effort to win the Governor’s approval.
New California Employment Laws Effective in New Year
Employers with operations in California should ensure their policies and practices are in compliance with the state’s new employment laws going into effect on January 1, 2014. The new laws will affect the day-to-day operations of many businesses.
Employer’s Arbitration Policy Unconscionable, Unenforceable under California Law, Ninth Circuit Rules
A grocery store’s arbitration policy was so one-sided that it “shocked the conscience” under California law and was unenforceable, the U.S. Court of Appeals for the Ninth Circuit has ruled, citing in part a provision requiring employees to split the arbitrator’s fees down the middle. Chavarria v. Ralphs Grocery Co., No. 11-56673 (9th Cir. Oct. 28, 2013). The Court affirmed the denial of the employer’s motion to compel arbitration and returned the case to the district court for further proceedings.
FAA Preempts California Rule Barring Arbitration of Certain Claims for Injunctive Relief, Federal Court Rules
The Federal Arbitration Act (“FAA”) preempted the California Supreme Court’s rule exempting claims for “public injunctive relief” from arbitration (known as the “Broughton-Cruz” rule), the U.S. Court of Appeals for the Ninth Circuit has ruled, reversing an order denying arbitration. Ferguson v. Corinthian Colleges, Inc. et al., No. 11-56965 (9th Cir. Oct. 28, 2013). The Court found the Broughton-Cruz rule was “clearly irreconcilable” with the U.S. Supreme Court’s recent decisions on the FAA. The Ninth Circuit returned the case to the district court, directing it to order arbitration.
Through the Lens of Concepcion: California Supreme Court Revisits the Validity of Agreements Requiring Employee Waiver of Wage Claim Administrative Processes
Almost one year after the U.S. Supreme Court summarily vacated the original 2011 Sonic-Calabasas opinion (Sonic I1), the California Supreme Court issued its opinion on remand in Sonic-Calabasas A, Inc. v. Moreno (Sonic II2).
California Supreme Court: Federal Arbitration Act Preempts State Labor Hearing Waiver Rule
The Federal Arbitration Act (“FAA”) preempts California law prohibiting the waiver of an administrative hearing before the California Labor Commissioner in an employment arbitration agreement, the California Supreme Court ruled in a 5-2 decision. Sonic-Calabasas A, Inc. v. Moreno, No. S174475 (Cal. Oct. 17, 2013).