. . . if they do it right.
(Part 3 of a four-part series.)
The National Labor Relations Board recently ruled that an employer may impose a mandatory arbitration program with a class or collective relief waiver after a collective action has been filed. The California Court of Appeal anticipated the Board’s ruling last February in Salgado v. Carrows Restaurants. In August, it reaffirmed the same rule in Quiroz Franco v. Greystone Ridge Condominium.
Both of the California decisions held that clear language applying the agreement to "all employment claims" would apply even to claims that had accrued before an agreement was entered. Thus, it is possible that an employer can implement an arbitration program after being sued. This is a particularly valuable option if a class action has been filed. Assuming the Federal Arbitration Act applies to the arbitration agreement, such a program could include an enforceable class relief waiver, effectively preventing class certification.
It is worth noting that the arbitration agreements in these cases were mandatory. After January 1, when
AB 51 goes into effect, employment arbitration programs would be vulnerable to the extent that they are mandatory. But AB 51 does not apply to agreements that are governed by the FAA. Moreover, AB 51 does not apply to arbitration agreements that are entered into voluntarily.
