California employment lawyer

The people of the United States love liberty and desire nothing but equal rights.

Ask a California employment lawyer:
I signed an arbitration agreement. Do I still have rights?

On the first day of your job, you were probably given a Mt. Kilimanjaro-sized amount of paperwork to sign in a very short period of time. One of those papers could have been an arbitration agreement. Arbitration agreements are contracts between you and your employer, where you agree to give up your right to file a lawsuit against your boss for wrongful termination, discrimination, harassment, and other workplace-related claims.

You probably didn’t even think about it when you first started your job. I mean, why would you begin your new job thinking you’re going to sue your employer? But, if you need to enforce your rights later on, that arbitration agreement might come back to haunt you.

Arbitrations have many problems.

Arbitration is not the ideal forum in most instances for you. Arbitration hearings are heard by an arbitrator, who is a lawyer paid by your former employer to listen to the evidence and make a decision. You won't have a jury hear your story. They won’t have an opportunity to listen to you. They won’t evaluate the fact that you are the likeable, wonderful person you are and that you were treated wrongfully.

Juries are far more likely to be sympathetic to your cause and conclude that you were being treated unfairly and illegally. In contrast, an arbitrator sees a lot of cases and has less empathy. Also, an arbitrator may want to stay in the good graces of your employer because your employer may be sued quite often -- that’s a steady stream of work!

Furthermore, you usually can’t appeal an arbitration agreement. Therefore, if you feel like the arbitrator's decision is unfair or wrong, you don’t have the right to have the appellate court take a second look at it. You are bound by the decision of the arbitrator.

It's possible to make arbitration agreements more fair procedurally.

In order to make the process more fair, the Supreme Court ruled in Armendariz v. Foundation Health Psychcare Services, Inc., that employers must observe certain fairness elements while drafting an agreement to arbitrate. Here are some provisions that can help create a more balanced arbitration process.

  Your employment rights are often your civil rights. Employers can’t sign contract to change statutes that protect your civil rights.  

  • You have the right to choose the arbitrator. You get as much say in choosing the arbitrator as your employer.
  • You have a right to adequate discovery. You have a right to discovery when you file a lawsuit. Discovery is a process which allows you to question and request documents of your employer before putting your case on at trial. However, sometimes arbitration agreements severely limit your ability to discover things. Without this, you are shooting blind when trying to enforce your civil rights or wage rights in arbitration. So in order to be fair, you have a right to conduct adequate discovery in arbitration, as you would in court.
  • You have a right to a written opinion regarding the basis for the arbitration decision. Your arbitrator must provide a written decision explaining her ruling and the reasoning behind her opinion. Why does this matter? As explained above, you have a very limited right to appeal the decision. But, in rare instances, you can appeal to court on the basis that the arbitrator’s decision was so unreasonable that it would be a great injustice to enforce her ruling. The only way you could hope to prove that would be to have a written decision from the arbitrator.
  • Fair arbitration agreements impose no limitation on the statute of limitations provided by law. Some employers have agreements that force you to bring your claim within a specified period (i.e. six months or one year). However, an arbitration agreement can’t impose new deadlines. If the law has a certain deadline, your employer can’t make it shorter to benefit them. This is because your employment rights are most often your civil rights and employers can’t contract their way out of statutes that protect your civil rights.

It's also possible to make arbitration agreements more of a burden on employers.

Fair arbitration agreements are mutual. Let’s say your employer bullies you into signing an arbitration agreement. You’d assume that if they wanted to sue you, they’d lose the same rights to bring the claim to court too, right? Sometimes, employers have tried to get away with not upholding themselves to the same arbitration agreement.

  An employer has to be fair and hold itself accountable to the same system it has forced on its employees.  

In Trivedi v. Curexo Technology Corp., the court ruled that an arbitration agreement was unenforceable, partly because it contained a provision allowing the employer to go to court to seek an injunction to stop an employee from disclosing intellectual property. The sourt found that since injunctions are the most common actions employers can take against an employee, the agreement was not mutual if it contained a provision allowing for injunctions to be brought in court.

In essence, what is good for the goose, is good for the gander. An employer has to be fair and hold itself accountable to the same system it has forced on its employees.

Fair arbitration agreements place the burden of the costs of arbitration on your employer. Your boss forced you into arbitration, so why should you have to pay? The California Supreme Court agrees this would be unfair. Your arbitration agreement should not impose on you any costs that are unique to arbitration. That means, while you may have to pay initial filing costs and general costs to run your case, you do not have to pay for the arbitrator or other arbitrator costs. That cost is borne exclusively by your former employer.

Are arbitration agreements becoming more or less fair over time?

Fairness standards have been long established in California to help protect your rights against unfair agreements. Recently, employers have tried to attack these fairness elements because of U.S. Supreme Court case AT&T Mobility v. Concepcion. That case examined whether or not a class action waiver in an arbitration agreement was enforceable.

The Supreme Court made a statement that arbitration agreements should not have any other hurdles to enforcement that aren’t required of any other type of contract. Employers have tried to argue that these fairness standards are different requirements than any other requirement to enforce a contract. That’s not true, and my colleagues and I are making sure this argument is defeated.

  I am confident that the law in California will remain the same: your employer has to present you with a fair and just arbitration agreement.  

I did significant work on an appellate case called Mayers v. Volt Management Corp. In that case, we argued to the California Court of Appeals that these fairness standards were the same elements examining whether a contract is enforceable, and the appeals court agreed. The case is currently pending before the California Supreme Court for review.

I am confident that the law in California will remain the same: your employer has to present you with a fair and just arbitration agreement.

Fight for justice! Know your rights!

If you are currently embroiled in a dispute with your employer and your boss is telling you that you have to take the claim to arbitration, call us so that we can discuss whether or not you signed a valid arbitration agreement.

If you feel you were treated unfairly, reach out to us.

Please make an appointment for a free consultation in our Newport Beach office. You can contact us by email or phone. We want to help.