California employers hoping to enforce arbitration agreements received some much-needed support recently from the Court of Appeals. The Fifth District Court of Appeal clarified in a newly-published decision that using certain “broad” language in an arbitration agreement does not automatically render those provisions, and thus the agreement, substantively unconscionable. Rather, the analysis should take into consideration the context of the employer’s operation, and whether the agreement’s terms creates an overbroad or “infinite” agreement.
Ayala-Ventura filed a putative class action against her former employer CCS Facility Services (“CCS”) for wage-and-hour and UCL violations. CCS moved to compel arbitration based on a mutual agreement to arbitrate executed during onboarding. The agreement covers “all claims” both parties may have against each other, whether or not arising out of employment, with specified exclusions, such as worker’s compensation, unemployment, and claims for injunctive relief. Ayala-Ventura opposed the motion arguing the agreement was unenforceable because, among other things, the agreement was overbroad in scope and duration, and that it lacked mutuality. The trial court granted the motion and Ayala-Ventura appealed.
The Court of Appeal upheld the trial court order and ordered Ayala-Ventura’s claims must be submitted to arbitration, rejecting each of Ayala-Ventura’s substantive unconscionability arguments, distinguishing CCS’ arbitration agreement from...
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