Monday, September 3, 2012

California court rejects effort to apply Pyett, denies employer’s request to compel arbitration

A California court has rejected an effort by American Medical Response to have a wage and hour suit submitted to arbitration rather than proceeding in court. Bartoni v. American Medical Response West. The suit involved a claim by current and former employees of AMR that it had violated state law on meal periods, rest breaks and overtime. AMR appealed from an order denying its motion to compel arbitration pursuant to the arbitration provisions of the collective bargaining agreements covering plaintiffs during the relevant periods. The lower court had determined that the agreements did not contain a “clear and unmistakable” waiver of plaintiffs’ right to a judicial forum for their statutory claims.

The grievance language provided “In the event any grievance arises concerning the interpretation or application of any of the terms of this Agreement, and/or any dispute concerning wages, benefits and working conditions, such matters shall be adjusted according to the procedures and conditions set forth below.” According to the court, none of the agreements contained provisions requiring defendant to comply with the California Labor Code, applicable wage orders, or state or federal law in general.

Affirming the lower court, the Court of Appeal observed that the Supreme Court’s decision in 14 Penn Plaza LLC v. Pyett  established that provisions in a cba that “clearly and unmistakably” require union members to arbitrate statutory claims are enforceable as a matter of federal law. Reviewing case law applying the clear and unmistakable standard, including the Supreme Court’s earlier decision in Wright v. Universal Maritime Service Corp., however, the court concluded that the general language of the contracts in issue here was insufficient to establish such a waiver. The Court noted:

As observed by the Fourth Circuit, "[w]hile it is . . . possible to meet the clear and unmistakable waiver standard of [Wright], it is not easy." (Eastern Associated Coal Corp. v. Massey, supra, 373 F.3d at p. 534.) Where two plausible readings of the CBA are possible, we do not decide which interpretation is the correct one. "The fact that there are at least two plausible and competing interpretations . . . is enough to demonstrate that the [provision] fails to provide a clear and unmistakable waiver. […]" (Id. at p. 536, citing Carson, supra, 175 F.3d at p. 332 ["[w]e hold that clear and unmistakable does not mean general language that under ordinary principles of contract interpretation might very well be interpreted to require arbitration"].) A union waiver of employee statutory rights in a CBA can "be effected only by the most `explicit' language, without any resort to inference." (Marcario v. County of Orange (2007) 155 Cal.App.4th 397, 405.) This principle appears fully applicable here.

Accordingly the court concluded that the lower court did not err in denying defendant’s motion to compel arbitration.

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