Arbitration Obligation Does Not Negate PAGA Standing, California High Court Holds, Rejecting U.S. Supreme Court Ruling

August 16, 2023

What's New

A Private Attorneys General Act (PAGA) case brought against an employer by a worker on behalf of himself and other workers can proceed even though the claim of the worker filing the lawsuit is subject to arbitration, the California Supreme Court held July 17. In Adolph v. Uber Technologies, the court unanimously held that a plaintiff who files a PAGA action with individual and non-individual claims does not lose standing to litigate the non-individual claims in court simply because the individual claims have been ordered to arbitration.

What It Means

Arbitrable and non-arbitrable issues in a case may be adjudicated in different forums while remaining part of the same action. In this ruling, the Supreme Court of California declined to follow the U.S. Supreme Court ruling in Viking River Cruises v. Moriana, which found that an employee who was bound by an arbitration agreement to resolve her individual complaints lacked standing to bring a PAGA lawsuit on behalf of other employees. California’s high court asserted that California courts rather than the U.S. Supreme Court have the ultimate authority to interpret state law.

What You Should Do

State law interpretation of arbitration agreements is complex. CWC members can benchmark with each other and share best practices at an upcoming Conversation Corners.

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