18th Annual Workplace Class Action Report - 2022 Edition

392 Annual Workplace Class Action Litigation Report: 2022 Edition wages in order to recoup alleged overpayments. Defendant demurred and the trial court sustained Defendant’s demurrer to the petition on the ground Plaintiff had not exhausted its administrative remedies. On Plaintiff’s appeal, the California Court of Appeal affirmed the trial court’s judgment. First, the Appellate Court held that because Plaintiff’s administrative remedies were inadequate because they did not seek class-wide relief, the trial court had erred in dismissing Plaintiff’s petition on that ground. However, the Court of Appeal further concluded that dismissal was proper because Plaintiff’s petition did not state valid claims against Defendant. The Court of Appeal reasoned that the home-rule doctrine gave Defendant the exclusive right to regulate matters relating to its employees’ compensation. As to Plaintiff’s allegation that the alleged deductions violated § 221 of the CLC, the Court of Appeal pointed to case law authorities that expressly held that various sections of the CLC do not apply to charter counties under the doctrine of home rule. As such, the Court of Appeal determined that Defendant’s MOU with Plaintiff was a lawful exercise of Defendant’s exclusive right to regulate matters relating to its employees’ compensation, and the CLC provision at issue did not apply to Defendant. Consequently, the Court of Appeal concluded that Plaintiff was unable to allege sufficient facts to state a cause of action, and it affirmed the judgment of the trial court granting Defendant’s demurrer. Betancourt, et al. v. Transportation Brokerage Specialists, Inc., 2021 Cal. App. LEXIS 263 (Cal. App. 1st Dist. March 29, 2021). Plaintiff, a “last-mile” delivery driver, brought a putative wage & hour class action alleging Defendant violated California’s Labor Code (“CLC”) and California’s Unfair Competition Law (“UCL”). Plaintiff also asserted claims pursuant to the Private Attorneys General Act (“PAGA”), as well as individual claims of unlawful retaliation and wrongful termination. Defendant moved to: (i) compel arbitration of Plaintiff’s individual claims, (ii) dismiss or strike the class claims pursuant to the class action waiver in the arbitration agreement, and (iii) stay the PAGA claim pending resolution of the claims at arbitration. Defendant argued that: (i) the Federal Arbitration Act (“FAA”) applied, as the FAA’s exemption for transportation workers engaged in interstate commerce was inapplicable to Plaintiff; (ii) the class action waiver was enforceable; and (iii) there were no grounds – including, in particular, unconscionability – to preclude enforcement of the arbitration agreement. The trial court denied Defendant’s motion to compel arbitration of Plaintiff’s individual claims and to dismiss or strike his class claims pursuant to the class action waiver. The trial court applied California law after finding that Plaintiff was exempt from FAA coverage because he was a transportation worker engaged in interstate commerce. The trial court also denied Defendant’s motion to dismiss or strike Plaintiff’s class claims on the grounds that the class action waiver was unenforceable under California law. The trial court also denied Defendant’s motion to compel arbitration of Plaintiff’s individual claims. It concluded that the unenforceable class action waiver rendered the arbitration agreement unenforceable. On appeal, Defendant challenged the trial court’s findings on FAA inapplicability, unenforceability of the class action waiver, and unenforceability of the arbitration agreement. The California Court of Appeal reversed the trial court’s order only as to that portion denying the motion to compel arbitration of Plaintiff’s individual claims for unlawful retaliation and wrongful termination, but in all other respects it affirmed the order. The Court of Appeal agreed with the trial court that Plaintiff was exempt from FAA coverage. Further, the Court of Appeal also agreed that the class action waiver was unenforceable under California law, and therefore it affirmed the trial court’s order denying the motion to dismiss or strike Plaintiff’s class claims. However, as to the portion of the trial court’s order denying the motion to compel arbitration of Plaintiff’s individual claims, the Court of Appeal held that the trial court improperly found the arbitration agreement unenforceable in its entirety rather than severing the class action waiver provision from the remainder of the employment agreement contained in the employment agreement. For this reason, the Court of Appeal ordered the trial court on remand to sever the class action waiver and determine whether to order arbitration of Plaintiff’s individual claims for unlawful retaliation and wrongful termination. Bravo, et al. v. Charter Communications, LLC, 2021 Cal. App. Unpub. LEXIS 1872 (Cal. App. 2d Dist. March 23, 2021). Plaintiffs, a group of telephone service representatives, brought a class action complaint asserting employment-related claims pursuant to California law. Defendants moved to compel arbitration of the claims. In support, Defendants established they sent an email to all active employees’ work email addresses announcing the company’s establishment of its legal dispute resolution program called “Solution Channel,” which allowed employees and the company to efficiently resolve covered employment-related legal disputes through binding arbitration. The email stated that by participating in Solution Channel, the employees and Defendants both waived the right to initiate or participate in court litigation including class, collective, and representative actions involving a covered claim. Further, the email provided that unless the employees “opted