Denial of Motion to Compel Arbitration Hinges on Burden of Proof and Existence of Statutory Rights
One of the “hot topics” we have posted about is whether the right to sue in court can be waived when the rights at issue are statutory rights. See our June 5, 2012 post on Iskanian v. CLS Transportation Los Angeles, LLC, Case No. B235138 (2nd Dist. Div. 2 June 4, 2012) (certified for publication) (interpreting AT&T Mobility v. Concepcion broadly to hold that the Federal Arbitration Act “conclusively invalidates the Gentry test” for finding that a statutory right is unwaivable and cannot be arbitrated); and our June 14 post on Hoover v. American Income Life Insurance Company, Case No. E052864 (4th Dist. Div. 2 May 16, 2012) (certified for publication) (underscoring a split in the law, concerning the arbitrability of state statutory labor claims). Ordinarily arbitrability turns on contractual interpretation and contract defenses.
Our next case, however, is important because of its particular focus on the burden of proof. In Bartoni v. American Medical Response West, A130333 (1st Dist. Div. 2 August 24, 2012) (Kline, P.J.) (unpublished), the trial court refused “to compel arbitration of plaintiffs’ wage and hour claims, where it determined the collective bargaining agreements (CBAs) between the union and defendant did not contain a ‘clear and unmistakable’ waiver of plaintiffs’ right to a judicial forum for their statutory claims.” The employer appealed.
The opinion is notable for its extensive review of cases applying the “clear and unmistakable” standard to determine whether there has been a waiver of a judicial forum. Wright v. Universal Maritime Service Corp., 525 U.S. 70 (1998) established the standard. In Wright, though the CBA contained an arbitration provision, a longshoreman filed suit in district court under the Americans With Disabilities Act of 1990. The district court dismissed the case because the employee failed to pursue grievance procedures in the CBA, the Fourth Circuit Affirmed, and the Supreme Court reversed, because the CBA did “not contain a clear and unmistakable waiver of the covered employees’ rights to a judicial forum for federal claims of employment discrimination.” Id. at 82. The rationale for the “clear and unmistakable” standard is that where the employee’s rights are created by statute, the ultimate question for the arbitrator will not be contractual interpretation, but an interpretation of what federal law requires – an issue for judicial determination, unless there is a “clear and unmistakable” waiver of the right to have a judge decide.
The court explains in Bartoni: “In applying the Wright analysis to determine whether there has been a sufficient explicit waiver, courts look to the generality of the arbitration clause, explicit incorporation of statutory requirements, and the inclusion of specific statutory provisions.”
Applying the Wright analysis in Bartoni, the Court of Appeal found that the arbitration provision was “too general”, ambiguous, and failed to incorporate specific statutory provisions regarding wage and hour disputes. It treated the use of the word “dispute” as too general in context, and borrowed the scorn heaped upon the ambiguous phrase “and/or” by legal writer Bryan A. Garner: “A legal and business expression dating from the mid-19th century, and/or has been vilified for most of its life – and rightly so.” (Bartoni, footnote 3).
The court’s extensive review of federal and state cases analyzing a CBA waiver of a statutory right led it to observe few cases hold a CBA waiver of a statutory right was clear and unmistakable, whereas, “numerous California cases have concluded CBAs failed to clearly and unmistakably require arbitration of statutory claims.”
The order denying the motion to compel arbitration was affirmed.
Labor strategists confer. 1937. From the left: Sidney Hillman, member of the CIO; Homer L. Martin, President of the U.A.W.; Leo Pressman, CIO General Counsel; John L. Lewis, President of the United Mine Workers; and John Brophy, Director of the CIO.
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