It tried to cover every claim, forever - and that's exactly what sank it
A California appeals court just refused to enforce a car dealer's arbitration agreements, ruling they reached too far and gave the worker too little.
Arbitration agreements are one of HR's most common tools for keeping employment disputes out of open court. A new published California decision is a reminder that how those agreements are written can decide whether they hold up at all.
On June 5, 2026, the California Court of Appeal for the Third Appellate District backed a trial court's decision to throw out arbitration agreements signed by a former dealership worker. On July 2, 2026, the court certified the opinion for publication, meaning other courts can now cite it.
The worker had moved between two Knight Sacramento SU Inc. dealerships - Elk Grove Subaru and Elk Grove Volkswagen - between 2022 and 2024. In August 2024 she sued over wage and hour issues, both for herself and on behalf of a class of current and former employees.
Knight tried to move the dispute into private arbitration, citing standalone agreements the worker had signed. The trial court refused, finding the agreements "procedurally and substantively unconscionable" - unfair both in how they were presented and in what they said. Knight appealed, and lost.
Two drafting choices sank the agreements, and both are the kind of language that comes out of an HR or legal team's template.
The first was scope. The agreements made the worker...
U.S. President Donald Trump used a primetime address to the nation Thursday to once again raise doubts about the results of past elections, reviving a subject he’s long used to make unproven claims...