Using Federal Laws to Prevent Mandatory Arbitration for Some California Employment Law Claims

Forced arbitration has become a powerful tool for California employers to deter successful employment claims. By compelling disputes to be resolved in private arbitration rather than through public court proceedings, employers often benefit from forums perceived as more favorable to their interests. Arbitration agreements are frequently presented as standard employment contract clauses, leaving employees with little choice but to comply. However, a complex interplay among employers, arbitrators, lawmakers, and advocates for employees’ rights continues to shape the legal landscape, particularly in California.

A Recent Arbitration Case

In a recent case, a transportation worker successfully avoided arbitration by leveraging federal law, showcasing the ongoing tension over forced arbitration. The plaintiff was a trucking dispatcher whose duties involved coordinating and facilitating the transportation of goods across state lines. He argued that, under the Federal Arbitration Act (FAA), his role qualified as a transportation worker engaged in interstate commerce, exempting him from arbitration. The case advanced through an initial complaint, in which the worker alleged multiple violations of California labor laws, including failure to pay wages and failure to reimburse business expenses. The employer promptly moved to compel arbitration, asserting that the plaintiff’s claims were covered under the FAA and preempted California labor statutes. The trial court, however, sided with the plaintiff in part, concluding that his role as a dispatcher was integral to the movement of goods in interstate commerce..

The California Court of Appeal upheld the trial court’s finding, affirming that the FAA did not apply to this worker. The court emphasized two key aspects in its analysis: defining the worker’s role within the transportation sector and determining whether the role was sufficiently tied to interstate commerce. While the plaintiff did not physically transport goods, his job duties—organizing shipments, liaising with drivers, and troubleshooting delivery issues—were deemed indispensable to the overall logistics process. The court’s reasoning followed modern jurisprudence rejecting the notion that physical involvement with goods is required to establish a worker’s exemption under the FAA.

The Takeaway

This outcome provides an essential reminder of the strategic importance of avoiding arbitration in California employment law cases. Arbitration can severely limit an employee’s ability to obtain a fair outcome. Arbitrators are often selected from panels with employer-friendly reputations, and proceedings typically lack the transparency and procedural safeguards of the court system. By remaining in the court system, the plaintiff in this case retains access to broader discovery and a jury trial, significantly improving his chances of a favorable outcome.

While avoiding arbitration is an essential first step in pursuing a California employment case, it is not a guarantee of victory. Employees must still present strong evidence to prove their claims, whether in court or arbitration. However, with competent representation, employees can navigate these challenges effectively. Employers, while often advantaged by arbitration, are not invincible; skilled attorneys can achieve just outcomes even in arbitration proceedings when necessary.

Schedule a Consultation with a California Employment Lawyer Today

If you believe your employer has violated your rights under California labor laws, the Hardin Law Group is here to help. Our experienced California employment attorneys are well-versed in avoiding forced arbitration, navigating federal exemptions, and pursuing appeals when needed. With a deep understanding of employment law, we are committed to helping employees secure the justice they deserve. Whether you face wage disputes, reimbursement claims, or other labor violations, we’ll formulate a strategy tailored to your situation. Reach out to the Hardin Law Group for a free consultation. Our team will assess your case, explain your options, and guide you through the legal process. Protect your rights and ensure your claims are heard. Call us today at (949) 337-4810, and let us fight for the justice you deserve.