Employment: Employee's Release Of Claim After It Accrued Is Not Illegal Or A Violation Of Public Policy

Employee Entered Into Release Of Claims In Her Separation Agreement.

        Elizabeth Castelo entered into a release of claims in her separation agreement from her employer Xceed Financial Credit Union. In arbitration, the employee argued that she had entered into a pre-dispute arbitration agreement that was invalid. The arbitrator ruled in favor of the employer, the court confirmed the award, and the employee appealed. Castelo v. Xceed Financial Credit Union, B311573 (2/7  5/18/23) (Escalante, Perluss, Segal).

        Some pre-dispute releases can be found invalid under some circumstances. Civil Code section 1668 provides: "All contracts which have for their object, directly or indirectly, to exempt any one from responsibility for his own fraud, or willful injury to the person or property of another, or violation of law, whether willful or negligent, are against the policy of the law."

        Here, however, the Court of Appeal agreed that Castelo knew about her claims before she entered into the release of claims. There was no violation of public policy.