A recent court decision has overturned a lower court's ruling that denied a former employee's motion to compel arbitration in a dispute with his previous employer. The complaint was filed by Andrew Helfet in the Superior Court of Los Angeles County on November 29, 2022, against Motive Energy, Inc., and its associated entities.
Andrew Helfet, who previously worked for Motive Energy, initiated legal action alleging violations of several labor laws, including the Labor Code, the Investigative Consumer Reporting Agencies Act, and the Credit Reporting Agencies Act. He also brought forth claims under the Private Attorneys General Act. Helfet contended that during his onboarding process at Motive Energy, he was presented with an "Employee Confidentiality and Mutual Arbitration Agreement" which he signed as a condition of employment. However, no representative from Motive Energy had signed this agreement.
The trial court initially ruled against compelling arbitration on two grounds: first, it found that there was no valid agreement to arbitrate since only Helfet had signed the document; second, it deemed certain provisions within the arbitration agreement unconscionable and thus unenforceable. Specifically, the court took issue with an injunctive relief exception and a fee-shifting provision within the agreement.
On appeal, however, the appellate court reversed this decision. The appellate judges concluded that despite Motive Energy's failure to sign the agreement, their conduct indicated consent to its terms. The company had prepared and presented the agreement as mandatory onboarding paperwork and employed Helfet after he signed it. This implied acceptance was sufficient to establish a binding arbitration agreement under California law.
Moreover, while acknowledging that one provision—allowing for fee-shifting—was indeed unconscionable as it could unfairly burden employees with costs they wouldn't face in court, the appellate court found this issue severable from the rest of the agreement. The judges determined that striking out this single provision would not undermine the central purpose of resolving disputes through arbitration.
Helfet’s legal team argued that allowing such agreements without mutual signatures could enable employers to selectively enforce or disregard arbitration clauses based on convenience. However, this concern did not sway the appellate court’s decision.
Ultimately, Helfet seeks class-wide relief for similarly situated employees along with individual remedies for alleged labor violations. The appellate ruling mandates that upon remand to the lower court, all arbitrable claims must proceed through binding arbitration as stipulated in Helfet’s employment contract with Motive Energy.
Representing Motive Energy were attorneys Natalie R. Alameddine and Nicole N. Wentworth from Blank Rome LLP. Andrew Helfet was represented by Omid Norati, Rene M. Madonado, and Sol Nunez from Nosratilaw. The case was presided over by Judge Carolyn B. Kuhl in Los Angeles County Superior Court under Case ID B331359.