{"id":2284,"date":"2022-08-03T16:34:15","date_gmt":"2022-08-03T16:34:15","guid":{"rendered":"https:\/\/shegerianconniff.com\/?p=2284"},"modified":"2022-08-03T16:34:15","modified_gmt":"2022-08-03T16:34:15","slug":"what-does-the-supreme-courts-decision-on-the-federal-arbitration-act-mean-for-employers","status":"publish","type":"post","link":"https:\/\/shegerianconniff.com\/dev\/what-does-the-supreme-courts-decision-on-the-federal-arbitration-act-mean-for-employers\/","title":{"rendered":"What Does the Supreme Court\u2019s Decision on the Federal Arbitration Act Mean for Employers?"},"content":{"rendered":"<p><span style=\"font-weight: 400;\">California\u2019s AB51 was signed into law in 2019. This law prohibits forced arbitration as a condition of getting a job. Employers cannot retaliate against employees who will not sign an arbitration agreement. But, there has been a lot of back and forth with this law after a federal judge granted an injunction claiming it interferes with FAA. Much of that decision was then struck down by the Ninth Circuit in September 2021. I<\/span><\/p>\n<p><span style=\"font-weight: 400;\">It&#8217;s recently become a hot topic again due to a recent decision in the Viking River Cruise appeal and the Supreme Court\u2019s decision. Here\u2019s what you need to know and what it means for employers and their employees.<\/span><\/p>\n<h3><span style=\"font-weight: 400;\">FAA vs. PAGA<\/span><\/h3>\n<p><span style=\"font-weight: 400;\">The Federal Arbitration Act (FAA) is a congressional act that allows for arbitration to be used to settle private (individual) disputes. What does this mean? Arbitration is a method of dispute settlement that uses an arbitrator to hear the dispute and make a decision. Once arbitration is decided, it is confirmed by a court. With FAA, the award has to be confirmed within 12 months and objections and challenges must be made within three months.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">The California Private Attorneys General Act (PAGA) became effective in 2004. It\u2019s an act that allows aggrieved employees to file a lawsuit regarding labor code violations to gain civil penalties for themselves, other employees, and the State of California. These civil penalties for companies with one or more employees are:<\/span><\/p>\n<ul>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">$100 per aggrieved employee per pay period for the initial violation<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">$200 per aggrieved employee per pay period for subsequent violations<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">Or, $500 if the employer has no employees at the time of the violation<\/span><\/li>\n<\/ul>\n<p><span style=\"font-weight: 400;\">This June, the Supreme Court ruled that FAA preempts a waiver related to PAGA. If you\u2019ve heard anything about this, or even if you haven\u2019t, it\u2019s important to understand what the Supreme Court\u2019s decision means. It could affect individuals who want to file complaints regarding labor code violations.<\/span><\/p>\n<h3><span style=\"font-weight: 400;\">Moriana vs. Viking River Cruises<\/span><\/h3>\n<p><span style=\"font-weight: 400;\">When Angie Moriana took a job with Viking River Cruises, her contract had an arbitration waiver and a waiver stating employees \u201ccannot bring any dispute as a class, collective, or representative action under PAGA.\u201d When she left her sales representative job with Viking River Cruises, she waited beyond 72 hours for her final paycheck, which is a violation of labor laws.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">She ended up filing an individual claim against the company for that and then for other violations (representative action) of California\u2019s labor code. Viking River immediately moved to dismiss the lawsuit stating that the contract she signed requires complaints to go to arbitration. California\u2019s appeals court ruled in favor of Moriana by saying that arbitration agreements are not allowed under PAGA.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">Viking River Cruises appealed that decision. The company wanted arbitration for the individual complaint and to toss out the representative complaint. The appeal went to the U.S. Supreme Court. The U.S. Supreme Court heard the appeal case and ruled for Viking River Cruises saying that FAA overrules PAGA rules and they reversed the California court\u2019s ruling. Essentially requiring Moriana\u2019s individual complaint to go to arbitration and the remaining complaints were dismissed per the contracted terms.<\/span><\/p>\n<h3><span style=\"font-weight: 400;\">How Does Arbitration Work?<\/span><\/h3>\n<p><span style=\"font-weight: 400;\">Arbitration is a process where complaints are heard outside of a court setting and the arbitrator hears both sides, looks at the evidence, and makes a decision. It\u2019s informal and usually less expensive than a court hearing. It can also be quicker to arrange and complete.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">Not every complaint qualifies for arbitration. Sexual harassment complaints are an example. Ending Forced Arbitration of Sexual Assault and Sexual Harassment Act became law on March 3, 2022. Employees are welcome to enter into arbitration if they want to voluntarily, but an employer cannot mandate arbitration.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">You\u2019ll need to be able to prove your case. This can be tricky if you don\u2019t have printed evidence. Your employer will have access to employment records to which you\u2019re not privy, and that can negatively impact your case. Make sure you are able to get the evidence needed. The best way to do this is to get information before you file the complaint to start the arbitration process. Once you file a complaint, you might find yourself shut out of company networks and databases.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">Once an arbitrator makes a decision, it is final if it\u2019s binding arbitration. Binding means it cannot be appealed or overturned in a court. There is also nonbinding arbitration, which means it can be rejected by either party and move to a court trial.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">Who chooses the arbitrator? It depends. Your employer may have to use an arbitration association like the American Arbitration Association. Sometimes, a company will choose an attorney to act as an arbitrator. You should be able to say who the arbitrator is, but this depends on the contract you\u2019ve signed. Make sure you understand if you\u2019re allowed to reject an arbitrator or not.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">If you do have a say, go over the disclosed information about the prospective arbitrator\u2019s personal interests, stocks, etc. If the arbitrator is found to hold stock in your employer\u2019s business, they may be biased. Look for potential bias and ask to reject that prospect. You may be limited to the number of rejections you\u2019re able to give, so use them carefully.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">Check to see if you\u2019re still allowed to have an attorney represent you. Just because the complaint isn\u2019t being heard in a courtroom, it doesn\u2019t mean you have to forgo the expertise of an attorney. Your employer is likely going to have legal representation to help them.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">Arbitration is private and only a few people are allowed in the room. Don\u2019t be afraid to speak up if you feel something is wrong or unfair. This is why it\u2019s best to have legal representation if you can, but if you can\u2019t, be vocal and advocate for yourself.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">Finally, don\u2019t be afraid to reach out to the U.S. Equal Employment Opportunity Commission. While you may be required to enter into arbitration, the EEOC may want to take a closer look at labor code violations.<\/span><\/p>\n<h3><span style=\"font-weight: 400;\">Don\u2019t Sign Employment Contracts Without First Consulting an Attorney<\/span><\/h3>\n<p><span style=\"font-weight: 400;\">What this does is places the power in the employer\u2019s hands if they have representative action waivers in place. As an employee, don\u2019t sign a contract if you\u2019re not 100% certain about what you\u2019re signing.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">Before you take a job, consider having an employment law specialist look over the contract to ensure your rights are protected. If a contract protects a company more than the employees, it\u2019s not an employment contract you should sign. The other benefit to having an employment law attorney look over the contract is that confusing terms are clarified. By doing this, you protect yourself from unpleasant work conditions.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">What if it\u2019s too late? You\u2019ve already signed an employment contract when you took your current job. Are you worried that your rights are being violated? If you\u2019re being mistreated by your employer, schedule a free consultation with Shegerian Conniff. We\u2019ll fight to ensure you\u2019re treated fairly, and we\u2019ll let you know if your contract allows you to file a complaint or if you\u2019re going to be required to enter into arbitration. Call or message us today to schedule a consultation.<\/span><\/p>\n","protected":false},"excerpt":{"rendered":"<p>California\u2019s AB51 was signed into law in 2019. This law prohibits forced arbitration as a condition of getting a job. Employers cannot retaliate against employees who will not sign an arbitration agreement. But, there has been a lot of back &hellip; <a href=\"https:\/\/shegerianconniff.com\/dev\/what-does-the-supreme-courts-decision-on-the-federal-arbitration-act-mean-for-employers\/\">Continue reading <span class=\"meta-nav\">&rarr;<\/span><\/a><\/p>\n","protected":false},"author":1,"featured_media":3745,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[15],"tags":[],"class_list":["post-2284","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-blog"],"acf":[],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v28.4 - https:\/\/yoast.com\/product\/yoast-seo-wordpress\/ -->\n<title>What Does the Supreme Court\u2019s Decision on the Federal Arbitration Act Mean for Employers? - Shegerian Conniff<\/title>\n<meta name=\"robots\" content=\"noindex, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"What Does the Supreme Court\u2019s Decision on the Federal Arbitration Act Mean for Employers? - Shegerian Conniff\" \/>\n<meta property=\"og:description\" content=\"California\u2019s AB51 was signed into law in 2019. This law prohibits forced arbitration as a condition of getting a job. Employers cannot retaliate against employees who will not sign an arbitration agreement. 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