WHEN MAY A COURT COMPEL AN INDIVIDUAL (OR REPRESENTATIVE) PAGA CLAIM TO ARBITRATION?

Written by Deborah Crandall Saxe*

In Viking River Cruises Inc. v. Moriana (2022) 142 S.Ct. 1906, 1922-1924, the Supreme Court of the United States held that the parties to an arbitration agreement may agree to arbitrate individual and/or representative Private Attorneys General Act (PAGA) claims. It also confirmed the validity of the rule set out in Iskanian v. CLS Transportation Los Angeles, LLC (2014) 59 Cal.4th 348, 383, that an employee cannot lawfully be compelled to waive the right to bring a representative PAGA action anywhere.

The Viking River decision has resulted in a flood of petitions to compel individual PAGA claims to arbitration in existing cases. After all, the Viking River court made compelling arbitration of the individual PAGA claim seem like a "magic bullet." According to the court, if an individual PAGA claim is compelled to arbitration, the plaintiff loses standing to maintain the representative PAGA claim, which therefore must be dismissed. I leave it to others to discuss whether the court was correct that compelling arbitration of the individual arbitration claim requires dismissal of the representative PAGA claim. This article is about something else. As an arbitrator, I am concerned that courts (with or without authority to do so) will compel individual PAGA claims to arbitration that the arbitrator has no jurisdiction to consider.

I know from experience that lawyers sometimes fail to read the arbitration agreement before making a motion to compel arbitration. A court recently compelled arbitration in a wage and hour class action and the parties then selected me as the arbitrator. The defendant assumed that I would arbitrate only the plaintiff’s individual wage and hour claim. However, as I had to point out, the arbitration agreement expressly provided that class claims were arbitrable, and the court’s decision to compel arbitration therefore put the entire class action before me. The agreement said: "Excluded from this Agreement are claims for workers’ compensation benefits, claims for unemployment compensation benefits, claims under the National Labor Relations Act or a union contract, and any claim that is nonarbitrable under applicable state or federal law. This Agreement otherwise includes all common law and statutory claims, including but not limited to, any claim for breach of contract, unpaid wages, wrongful termination, and infliction of emotional distress, and any and all claims brought or attempted to be brought by me as a class action, collective action or representative action."