Brown v. Ralphs Grocery Co.

Enforceability of Employment Contracts that Preclude Classwide Arbitration

U.S. Chamber's Position: 

NCLC urged the California Supreme Court to reverse a decision of the Court of Appeal that erroneously held that employment agreements to arbitrate claims under California's Private Attorney General Act (PAGA) only on an individual basis are unenforceable as a matter of public policy. In this case, plaintiffs brought a class action under PAGA alleging wage and hour labor violations, and the employer sought individual arbitration of the dispute pursuant to the employment contract.  In spite of strong precedent set by the Supreme Court’s recent decision in AT&T Mobility v. Concepcion, the lower court found the employee contract to be unenforceable under California law, and nullified the individual arbitration agreement. NCLC's amicus brief argued that the decision, which effectively requires employers to agree to classwide arbitration or lose access to arbitration altogether, squarely conflects with the U.S. Supreme Court's recent decision in AT&T Mobility v. Concepcion, and exposes employers and employees alike to costly and inefficient litigation.

Case Outcome: 

Review was denied on 10/19/2011.  

Procedural History: 

NCLC amicus brief filed 9/21/11.  Review was denied on 10/19/2011.