A former employee has taken legal action against two companies, alleging significant labor violations. Jester Jacob filed a complaint in the Santa Clara County Superior Court on February 2022 against Western Digital Technologies, Inc. and Employnet, Inc., accusing them of failing to pay owed wages, not providing timely payments upon employment separation, and issuing inaccurate wage statements.
Jacob's lawsuit seeks civil penalties under the Labor Code Private Attorneys General Act of 2004 (PAGA) on behalf of himself and other current and former employees. The defendants moved to compel arbitration based on a predispute arbitration agreement signed by Jacob in March 2021. However, the trial court denied this motion, stating that Jacob’s entire PAGA claim must proceed in court according to the terms of the arbitration agreement.
The defendants appealed this decision, arguing that the trial court erred in denying their motion to compel arbitration of Jacob's individual PAGA claim. They contended that their arbitration agreement required all disputes related to Jacob’s temporary assignment at Western Digital to be resolved through individual arbitration as per the Federal Arbitration Act. The agreement included a class action waiver that mandated disputes be resolved individually and not on a representative basis.
However, the trial court found that waivers of representative PAGA claims are invalid under current law. The court observed that the language in the arbitration agreement did not distinguish between individual and representative PAGA claims and concluded that because representative action waivers are unenforceable, Jacob’s PAGA claims must proceed in court.
Jacob opposed the motion to compel arbitration by arguing that since the class action waiver was unenforceable, it rendered the entire arbitration agreement void. Defendants countered by claiming that their waiver was tied to applicable law and should enforce individual PAGA claims into arbitration while allowing non-individual claims to be litigated in court.
Ultimately, the appellate court affirmed the trial court's order denying arbitration. It determined that due to ambiguous language regarding "individual" and "representative" claims within the parties' agreement, no portion of a representative PAGA action could be arbitrated under current legal precedent. Thus, Jacob's entire PAGA claim will proceed in court.
Representing Jester Jacob is attorney [Plaintiff's Lawyer], while Western Digital Technologies and Employnet are represented by [Defendant's Lawyers]. The case is being overseen by Judges Bamattre-Manoukian (Acting Presiding Judge), Danner (Judge), and Bromberg (Judge) under Case ID H050775.