The US Supreme Court, in a recent decision in Viking River Cruises, Inc. v. Moriana, enforced a bilateral arbitration agreement that limited Viking River Cruises liability for a Private Attorneys General Act (PAGA) representative action. What does this mean for California employers? This recent decision suggests that California employers may be able to use properly drafted arbitration agreements to limit their liability in reference to PAGA representative claims. While California law currently prohibits mandatory arbitration agreements as a condition of employment, it may be worth your extra time and effort to provide your new candidate or even current employees the option to enter into a bilateral arbitration agreement at their choosing. Doing so may protect you in the future against a potential representative action, as it did here in this case with Viking River Cruises. It’s important to make sure that your arbitration agreement is valid under California law and contains a severability clause. Reach out to your Mitzel Group attorney today to review your current arbitration agreements, set up your arbitration policy and discuss any questions you might have about using arbitration agreements.
