As part of Renne Public Law Group’s (RPLG) affirmative litigation program, we occasionally bring discrimination and retaliation cases on behalf of plaintiffs against corporate employers. In 2020, we sued American Automobile Association of Northern California, Nevada & Utah (“AAA”) on behalf of Aljarice Hasty, an African American woman who was fired for advocating in favor of the Black Lives Matter Movement on her private Facebook page. Apart from its social justice implications, the lawsuit took on a new significance in the realm of private sector employee rights.

Most private employers now require employees to sign arbitration agreements as a condition of employment. This practice requires employees to waive their rights to file lawsuits in court regarding most aspects of their employment—e.g., claims for harassment, retaliation, discrimination, etc. The state previously outlawed such requirements, but that law was struck down by federal courts. For arbitration agreements to be effective, California law requires employers to provide their employees clear notice of the agreement and obtain the employees signature. However, over time, many large employers have transitioned to automated onboarding processes on platforms such as Workday. Depending on how they are configured, such platforms may not provide employees with the notice they are lawfully entitled to and obscure the fact that they are waiving valuable rights, such as a trial by jury.

On December 21, 2023, the Court of Appeal for the Third Appellate District held that AAA’s arbitration agreement and configuration of Workday was unconscionable and refused to enforce it. The Court’s decision, which was just certified for publication, held, among other things, that the agreement and AAA’s configuration of Workday were deployed with an aim “to thwart, rather than promote the nondrafting party’s understanding” and did not “promote voluntary or informed agreement…” The decision is one of the first published attempts by the Court of Appeal to grapple with computerized waivers in the employment context. The Court’s analysis will hopefully send a message to companies like AAA that, if they are going to require employees waive their rights at the doorstep, they need to be upfront about it. We agree with the State Legislature on this issue and generally oppose such mandatory waivers of individual employment rights. Our government clients have rarely attempted to impose such requirements. But, as courts have generally upheld mandatory arbitration agreements in employment, we are very pleased to have helped enforce the requirement that at least such waivers must be intentional and well-understood.

RPLG practices throughout California, advising and advocating for public agencies, nonprofit entities, individuals and private entities in need of effective, responsive and creative legal solutions. For more information on this case, please contact your RPLG attorney or Imran Dar.

Read the full published opinion here.