Valid Employment Arbitration Agreement Could be Enforced to Dismiss Administrative Wage Claim in California
In Sonic-Calabasas A, Inc. v. Moreno, B204902 (May 29, 2009, Second Dist, Div. Four), the California Court of Appeals considered whether an admittedly valid employment arbitration agreement, governed by the Federal Arbitration Act (“FAA”) may be enforced to dismiss a former employee’s administrative wage claim for unpaid vacation time.
Plaintiff and his employer had an arbitration agreement, which Plaintiff conceded was valid. The agreement required both parties to submit their employment disputes to arbitration under the FAA. Plaintiff left his position with Defendant and thereafter Plaintiff filed his administrative wage claim with the California Labor Commissioner according to the “Berman” process provided in Labor Code §§ 98 et seq. The employer responded with a petition to compel arbitration and to dismiss the Berman proceeding. The superior court denied the petition as premature. The superior court stated that until there was a preliminary non-binding hearing and decision by the Labor Commissioner, the arbitration agreement was unenforceable.
The Appeals Court reviewed the agreement and found it stated that it allowed Plaintiff to file administrative proceedings only before the California Department of Fair Employment and Housing or the Equal Employment Opportunity Commission. Because neither the Labor Commissioner nor the Division of Labor Standards Enforcement was listed among the stated exceptions, Plaintiff was barred from pursuing an administrative wage claim. The arbitral forum provided in the arbitration agreement was adequate to allow Plaintiff to vindicate his statutory rights. The employer’s petition to compel arbitration was granted.
