California: Class Arbitration Prohibited if Not Authorized in Agreement

National Law Review 9/2012, betreff US-Arbeitsrecht und Erhebung einer Sammelklage; Unzulässig, wenn nicht explizit in einer bestehenden Schiedsgerichtsvereinbarung aufgeführt.

A California appeals court recently held that a former security officer’s wage-and-hour class action suit must be submitted to arbitration on an individual basis and that class arbitration is prohibited unless expressly noted in the arbitration agreement. In Jesus Reyes v. Liberman Broadcasting, Inc., the California Court of Appeal, Second Appellate District, reversed the lower court’s denial of the employer’s motion to compel arbitration based on the arbitration agreement Reyes signed before working for Liberman Broadcasting, Inc. (LBI). In this arbitration agreement, Reyes agreed to arbitrate any disputes with LBI “arising out of, relating to or in any way associated with” Reyes’ employment with LBI as a security officer. Reyes worked at LBI from April to September 2009. In May 2010, Reyes filed a wage-and-hour class action.

Initially, LBI answered the complaint and did not seek to compel arbitration. More than a year into the litigation, in July 2011, LBI filed a motion to compel arbitration. The lower court denied LBI’s motion, stating that the company waived its right to arbitration by its “failure to properly and timely assert it.” LBI then appealed.

The Second District Court of Appeal held that LBI did not waive its right to compel arbitration. In reaching this conclusion, the three-judge panel analyzed the following factors in determining that no waiver of right to arbitrate occurred:

1. Whether LBI’s actions were inconsistent with the right to arbitrate

2 ...

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