Many Orange County business owners require that employees sign arbitration agreements at the outset of their employment. These agreements state that in the case an employment claim arises, the employer and employee agree to avoid court and head to arbitration to resolve the issue. While certain kinds of claims (such as workers’ compensation claims) must be excluded from agreements that require arbitration, as an arbitration agreement will not be enforced in California if it is both “procedurally unconscionable” and “substantively unconscionable”, both federal and California public policy favor arbitration as a form of alternative dispute resolution.
Arbitration is generally supposed to be faster, cheaper, and more predictable than litigation. Benefits many Orange County business owners appreciate. However, in a recent case involving homebuilder D.R. Horton, none of these expectations came true. In its arbitration agreement, D.R. Horton prevented employees from suing in court and from bringing class-action claims in arbitration. A disgruntled employee took issue to this, bringing his fight to the National Labor Relations Board. Along with a class of similarly-situated employees, he sought alleged unpaid overtime wages.Details