Two employees sued their former employer for wage and hour violations. The employer moved to compel their claims to arbitration. Plaintiffs filed an opposition to the motion, contending that the arbitration agreement was unconscionable. The trial court agreed with Plaintiffs and denied the employer’s motion. The employer appealed and the Court of Appeal affirmed the trial court’s order. The Court of Appeal found that the arbitration agreement was tainted with provisions which unfairly favored the employer.
For example, the arbitration agreement allowed the employer to sue Plaintiffs in court to enforce any non-competition or confidentiality agreement – claims which are normally brought by an employer – but required Plaintiffs to arbitrate claims that employees would ordinary file against an employer. A confidentiality provision unreasonably restricted Plaintiffs’ rights and ability to develop their case by limiting the persons to whom they could disclose information about the arbitration to while permitting the employer to disclose the matter to a far broader group of persons.
