Top Employment Law Cases of 2019
| Jurisdiction | United States,Federal,California |
| Author | By Andrew H. Friedman, Ramit Mizrahi, and Anthony Oncidi |
| Publication year | 2020 |
| Citation | Vol. 34 No. 1 |
By Andrew H. Friedman, Ramit Mizrahi, and Anthony Oncidi
Andrew H. Friedman is a partner with Helmer Friedman LLP in Culver City, where he primarily represents employees in all areas of employment law. Mr. Friedman is the author of a leading employment law practice guide—Litigating Employment Discrimination Cases (James Publishing, 2007). Ramit Mizrahi is the founder of Mizrahi Law, APC in Pasadena, where she represents employees exclusively. She is Chair of the Pasadena Bar Association Labor and Employment Law Section and Immediate Past Chair of the CLA Labor and Employment Law Section. She can be reached at ramit@mizrahilaw. com. Anthony J. Oncidi is a partner in and the Chair of the Labor and Employment Department of Proskauer Rose LLP in Los Angeles, where he exclusively represents employers and management in all areas of employment and labor law. His telephone number is (310) 284-5690 and his email address is aoncidi@proskauer.com.
In what has become the new normal, 2019 saw a continued deluge of employment decisions, an average of more than one new opinion each day! The courts also issued multiple important decisions that, while not in employment law cases, directly affect employment attorneys and their clients.
In a trio of cases—Henry Schein, Inc. v. Archer & White Sales, Inc.,1 Lamps Plus, Inc. v. Varela,2 and New Prime Inc. v. Oliveira,3—the U.S. Supreme Court addressed the scope of arbitration provisions and who (the court or an arbitrator) determines whether a matter is arbitrable in the first instance.
In Henry Schein , a non-employment law case, in a unanimous opinion by Justice Kavanagh, the Court held that where an arbitration agreement contains a delegation clause, the threshold issue of arbitrability must be decided by the arbitrator; rejecting the "wholly groundless" exception which many courts had adopted that allowed the trial court to decide that gateway issue.
In New Prime, a unanimous 8-0 decision (Justice Kavanaugh recused), the Court ruled that independent contractor drivers engaged by a transportation company cannot be forced to arbitrate their wage and hour claims under the Federal Arbitration Act's Section 1 exclusion for transportation workers engaged in foreign or interstate commerce, because that exclusion covers independent contractors as well as employees. The Court also held that a district court must make an "antecedent determination" of whether the Section 1 exemption applies to a contract before compelling arbitration, even if the parties' arbitration agreement contains a clause delegating such threshold determinations to the arbitrator.
Finally, in Lamps Plus, a 5-4 decision, the Court held, in an opinion written by Chief Justice Roberts, that, under the FAA, class-wide arbitration cannot be ordered if the arbitration agreement is ambiguous as to whether the parties agreed to it. In doing so, the Court emphasized that a "foundational FAA principle"—indeed, "the first principle that underscores all of our arbitration decisions"—is that "[a]rbitration is strictly a matter of consent."4 Justice Ginsburg, joined by Justices Breyer and Sotomayor, wrote to "emphasize once again how treacherously the Court has strayed from the principle that 'arbitration is a matter of consent, not coercion.'"5 She explained that Congress enacted the FAA "to enable merchants of roughly equal bargaining power to enter into binding agreements to arbitrate commercial disputes." Yet, the Court "has routinely deployed the law to deny to employees and consumers 'effective relief against powerful economic entities.'"6
In two other important cases—OTO, LLC v. Kho,7 and Subcontracting Concepts (CT), LLC v. De Melo8—the California courts invalidated arbitration provisions as unconscionable.
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In OTO, the California Supreme Court granted review to consider whether an arbitration agreement that required the waiver of statutory rights to a Berman hearing offered an accessible and affordable process for resolving those disputes, consistent with Sonic-Calabasas A., Inc. v. Moreno.9 However, the California Supreme Court never actually reached that issue. Instead, it concluded that the arbitration agreement in question involved such an unusually high degree of procedural unconscionability coupled with substantive unconscionability sufficient to render the entire agreement unenforceable. An important question for employers emerges in the wake of OTO, which is whether it is worth it to jeopardize the arbitration of more serious discrimination and harassment claims in order to secure arbitration of low-risk Labor Commissioner claims. In fact, why any employer would insist upon arbitration of a Labor Commissioner claim, where potential liability is rather limited, remains a bit of a mystery.
In Subcontracting Concepts,10 the court of appeal analyzed an arbitration provision buried at the end of an "Owner/Operator Agreement" that was five pages long, in a small font. The arbitration clause provided that disputes within the jurisdictional maximum for small claims would be resolved there, and that all other disputes would be arbitrated in accordance with the FAA. The arbitration clause: (a) provided for arbitration before a three-arbitrator panel, with costs to be split; (b) contained a class action waiver; (c) prohibited PAGA actions; (d) limited each party to three depositions with a two-hour maximum each; and (e) limited the arbitrators to awarding actual monetary damages only, with no punitive or equitable relief, and no award of attorney fees or costs. De Melo was presented this agreement "on the spot" when he was hired. De Melo's native language is Portuguese, and he is not fluent enough to understand documents written in English. He was given the document in English, and no one explained it to him in any detail in Portuguese or English. He had no idea what arbitration was or the rights that he was giving up.
Several years later, De Melo filed a claim with the Labor Commissioner. SCI filed a petition to compel arbitration in court. The Labor Commissioner intervened and opposed the petition. The trial court denied the petition, concluding that the arbitration clause in the employment agreement was unconscionable. SCI appealed. The court of appeal affirmed, holding not only that Armendariz's protections apply to both employees and independent contractors, but also that the agreement was unconscionable.
In Wilson v. Cable News Network, Inc.,11 the California Supreme Court granted review to address a split over whether anti-SLAPP protections apply to otherwise protected conduct motivated by unlawful discrimination or retaliation. Stanley Wilson was fired from his position as a field producer with CNN, after 17 years with the network, allegedly for plagiarism. Wilson sued, alleging violations of the FEHA and CFRA, and that he was defamed when the network told prospective employers that he had committed plagiarism. CNN filed an anti-SLAPP motion under CCP § 425.16, arguing that the FEHA and CFRA causes of action were based largely on the firing, and that CNN's decision was "in furtherance of its right to determine who should speak on its behalf on matters of public interest." It argued that the defamation claim also arose from protected speech. The trial court granted the motion. The court of appeal reversed, holding that allegations of discrimination or harassment fall outside the scope of the anti-SLAPP statute.
The California Supreme Court granted review. It held that activity protected under the anti-SLAPP statute retains that protection even if the plaintiff alleges that the conduct was the result of unlawful...
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