A California appellate court ruled that an employer could not compel arbitration based on an agreement between the employee and the staffing agency that placed her.
A temporary staffing agency that hires and places workers at California businesses, Real Time Staffing Services (Real Time), hired Nelida Soltero as an employee in December 2016. As part of her onboarding process, Soltero electronically signed the Spanish language version of a Mutual Agreement Regarding Arbitration and Class Claims.
The agreement defined “the Company” to include Real Time, its parent company, multiple other named companies and “all related entities,” but not their clients.
Real Time placed Soltero with one of its clients, Precise Distribution, in October 2017, where she worked for several years. In 2022, Soltero filed a class action complaint against Precise, alleging various violations of the California Labor Code, including failure to provide required meal periods and rest breaks, to pay premiums for meal and rest break violations and to issue compliant wage statement claims.
Soltero did not name Real Time as a defendant.
Precise filed a motion to compel arbitration based on the arbitration agreement between Soltero and Real Time, arguing that, even as a nonsignatory to the agreement, it was entitled to compel arbitration based on theories of equitable estoppel, third-party beneficiary and/or agency.
The trial court denied the motion and the appellate panel...
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