Parties to this Agreement
This agreement (“Agreement”) is entered into between ___________________________ (“Employer”), and the individual employee whose signature appears at the end of this agreement (“Employee”). Employer and Employee are sometimes referred to herein collectively as the parties.
Purpose of this Agreement
Legal disputes are frequently complicated, expensive, slow, and damaging to all involved. Employer hopes that disputes with its employees do not occur. However, if disputes do occur, then it is in everyone’s mutual interest that these disputes are handled promptly, with a minimum of disturbance to Employer’s business and to the employees’ lives. Arbitration is often regarded as a faster, more efficient and more flexible method for resolving disputes. Therefore, the purpose of this Agreement is for Employer and Employee to mutually agree to have their disputes exclusively resolved by way of Arbitration. In order to ensure that claims are resolved promptly and with a minimum of costs, the parties also agree that claims must be submitted for arbitration within two years or they are waived, and that the parties will not pursue class or representative actions. Each of these terms is further addressed herein.
Exclusive Arbitration and Waiver of Alternative Forums
Employer and Employee agree that they shall utilize binding arbitration as the exclusive means to resolve all claims covered by this Agreement. Employer and Employee therefore mutually and specifically agree that they shall be precluded from bringing or raising in court or other forum any dispute that was or could have been brought or raised under the procedures set forth in this agreement. The parties specifically waive any rights they may have to trial by jury. To the extent permitted by law, the parties waive the right to bring or have heard any claims before a court, administrative agency, or other forum or body of any nature and agree to solely adjudicate all claims in binding arbitration per the terms of this Agreement and the Federal Arbitration Act.
The parties agree to exclusively arbitrate all disputes that may arise out of or be related to Employee’s employment with Employer, including but not limited to the termination of that employment, the conditions of employment, and any compensation, penalties, or other damages due to the employee by reason of that employment. Such claims are addressed herein as the “Covered Claims.” The Covered Claims would therefore include, but are not limited to, claims for wrongful termination, discrimination or harassment, breach of contract, claims relating to accommodation for disabilities, tort claims, negligence claims, or claims for violation of any other law, including violations of the California Labor Code.
The parties intend for the entirety of all claims to be addressed by the Arbitrator to the extent possible. As a non-exhaustive example, the parties specifically agree that claims relating to the arbitrability of a claim or the application or interpretation of this Agreement should be determined by the arbitrator in arbitration. Likewise, the parties agree that any claims made as against Employer’s subsidiary or affiliated entities or its individual officers, directors, agents, and employees (in an official or personal capacity) are likewise subject to arbitration.
Excluded Claims and Legal Limitations on Waivers
In order to minimize cost and inconvenience, the parties intend to have this Agreement be interpreted as broadly as possible to require all claims to be exclusively decided in arbitration. However, the parties acknowledge certain claims need not be arbitrated.
The parties agree that they may bring a claim in the California small claims court. Such court uniquely provides for greater efficiency than even arbitration, and therefore meets the purposes of the parties. The parties agree that if a claim is originally brought within the small claims court and is subsequently transferred to the superior court limited or unlimited divisions or classifications, then the parties shall not pursue such claim and all waivers and other matters addressed herein are applicable to such claim notwithstanding its origin as a small claims case. Such action must be dismissed after reclassification and the dispute pursued in arbitration and according to the terms of this Agreement, alone.
Employer and Employee also agree that certain laws exist which may limit the power of the parties to waive their right to proceed in a given forum. Common examples include claims relating to worker’s compensation benefits, unemployment compensation benefits, and claims relating to the National Labor Relations Act. In lieu of attempting to list every such exception, the parties agree and acknowledge that the broad waivers and agreement to arbitrate are not intended to apply to any claim to the extent to which the law prohibits waiving the right to bring that claim in a specified forum. Therefore, the parties agree that the Employer and Employee retain such un-waivable rights to proceed on such claim in such forum, however, with that interpretation limited and interpreted to be consistent to the extent permissible with the parties’ intention to have all matters determined exclusively in arbitration to the extent permitted by law.
Claims Brought Only on Employer or Employee’s Own Behalf
Except as otherwise required under applicable law, (1) Employee and Employer expressly intend and agree that class action and representative action procedures shall not be asserted, nor will they apply, in any arbitration pursuant to this Agreement; (2) Employee and Employer agree that each will not assert or maintain or join any class action or representative action claims, which includes PAGA claims that address violations relating to any person other than Employee, against the other; and (3) each of Employee and Employer shall only submit their own, individual claims in arbitration and will not seek to represent the interests of any other person. For clarity, this provision also acts as an express limitation on the powers of the arbitrator, such that the arbitrator shall not have the power to order or hear a class or representative action. To the extent possible, the parties intend that their individual claims should be addressed in a singular and efficient arbitration, undiluted by the claims of others. Employer and Employee will take all reasonable steps to avoid the actions of third parties from defeating the terms of this Agreement, including that Employer and Employee shall not consent to joining and shall affirmatively act to opt-out of any claims or relief brought in a representative capacity and commenced by another party, such that neither Employer nor Employee will voluntarily be a class member in a class action as against the other and neither party shall permit their personal or individual damages or harms to be addressed by way of a representative action of any nature; to the extent that the parties have any ability to waive, withdraw, opt-out, of any representative action or recovery on a representative action, then the parties will and do so waive their rights and agree to remove themselves from such actions and to ensure that any disputes between the parties will be handled on an individual arbitration as between the two parties. If any portion of this representative action waiver is deemed unenforceable, any remaining portion of the waiver which is found to be valid shall nonetheless be enforced in arbitration.
Two Year Time Limit to Bring Covered Claims (Statute of Limitations Modification)
The parties agree that they intend for claims to be brought promptly and expeditiously to resolution and therefore that all claims should be filed and addressed within two years. Therefore, the parties agree that any Covered Claims must be submitted to binding arbitration within two years from the date the dispute arose or the Employee or Employer first became aware of the facts giving rise to the dispute, unless claim is subject to a shorter statute of limitation or timing requirement, in which case the shorter timeline shall apply. If any employment related dispute or Covered Claim which may arise is not submitted to binding arbitration within two years from the date the dispute arose or within two years from which the Employee or Employer reasonably should have first became aware of facts giving rise to the dispute, then Employee and Employer agree that the claim shall be void and considered waived to the fullest extent allowed by law. The effect of this Agreement is that the parties have two years to bring their claims to arbitration, or their claims are forever barred and the parties forbidden to bring such claims and deemed to have waived such claims, no matter the merits of the claim or any other circumstances. The parties are therefore urged to bring claims for resolution promptly, and certainly within two years, in order to avoid such a waiver. Again, no matter the circumstances, if Employee or Employer wait more than two years to have their claim addressed by the commencement of arbitration, then that claim is waived, and the Employee and Employer have no right to seek any compensation or relief whatsoever; additionally, because the parties have waived their rights to proceed in Court or other forums, that means that the parties will never receive any compensation or relief whatsoever and never be entitled to have their dispute heard or addressed by an arbitrator, court, or anyone else ever. This policy is essential in ensuring the purpose of this Agreement – the Employer cannot resolve a problem that the Employer has no notice or knowledge of. By requiring all problems to be promptly addressed and reported, the Employer can timely cure those issues and eliminate the future concern of the Employee and any others employed by Employer. Moreover, the parties’ ability to accurately present their claims (and their memories) are maximized by having the dispute addressed promptly. Again, the parties agree that they desire this term to apply as broadly as possible to all claims, yet acknowledge that the law may prohibit this provision from applying to certain claims. The parties therefore agree that this provision shall not apply to any claim where that application would be in violation of law.
Arbitration Procedures and How to Commence Arbitration
Arbitration shall be commenced with Judicate West by submission of the “Notice of Intent to Arbitration (NIA) / Demand for Arbitration”, as updated and available from the Judicate West website (judicatewest.com) and MAILED to the opposite party. In the event that the Judicate West website is unavailable, or that Judicate West ceases to operate or exist, or that the parties mutually agree to an alternative arbitration provider, then the arbitration may be deemed as commenced by an equivalent written submittal by the party requesting arbitration and MAILED to the opposite party, which submittal shall identify that the document is a “Demand for Arbitration”, and that document shall briefly list each of the claims to be adjudicated and the relief sought by the party seeking arbitration. In light of the ambiguity involved in certain digital forms of correspondence and in the difficulty in ensuring that documents are accorded the necessary attention and/or provided to legal counsel as necessary (particularly as claims will not appear as a formal court issued ‘summons’ and therefore persons have sometimes failed to recognize that an arbitration was actually received, which creates additional costs and delays), the parties agree that, in this instance, and this instance alone, an arbitration demand must be MAILED, and not e-mailed or otherwise delivered. Any notice to Employer shall be addressed to “___________[insert address]___________.” Any notice to the Employee shall be to their address identified in their employee file or to any other address requested by Employee.
Absent mutual written agreement by the parties, the arbitration shall take place with Judicate West before a single arbitrator who shall be a retired judge from a Superior Court located in California. The arbitration shall take place within one of the counties of Orange or Los Angeles in California. The arbitration shall be in accordance with the rules of the resolution of employment disputes of Judicate West, except where such rules conflict with this agreement, in which case the terms of this agreement shall control. The arbitrator shall apply California state substantive law to the claims. Procedurally, all California rules of pleading, all rules of evidence, and all rights to resolution of the dispute by motions for summary judgment, motions for judgment on the pleadings, and judgment under California Code of Civil Procedure (“CCP”) § 631.8 shall apply. The parties shall have the right to engage in discovery, including, but not limited to, the right to subpoena records and take depositions. The parties shall further have the power to engage in discovery directed to non-parties to the arbitration, including by subpoena and deposition, and the parties therefore expressly incorporate CCP § 1283.05 and 1283.1 herein to ensure those rights and powers. The arbitrator is empowered to award only that relief and those remedies that would otherwise be available for the particular claims asserted in a court of the appropriate jurisdiction sitting in California. The award issued by the arbitrator shall include the arbitrator’s reasoned opinion.
This is the Complete California Agreement
This Agreement shall be governed by the law of the State of California. This document constitutes the entire agreement for arbitration between the parties. The provisions herein supersede any other prior or contemporaneous agreements or understandings between the parties. The parties agree that there are no unwritten agreements, promises, or representations between the parties with respect to this Agreement. The parties agree that they have not relied on any representation or statement which has induced them to enter into this Agreement, and that the parties do not anticipate and have not been promised any further consideration, incentive, action, or forbearance by the parties based on the execution of this Agreement, outside of those terms expressly written herein. The parties agree that the terms of this Agreement shall not be modified or amended except by a writing signed between the parties.
MY SIGNATURE BELOW ATTESTS TO THE FACT THAT I HAVE READ, UNDERSTAND, AND AGREE TO BE LEGALLY BOUND TO ALL OF THE ABOVE TERMS. I FURTHER UNDERSTAND THAT THIS AGREEMENT REQUIRES ME TO ARBITRATE ANY AND ALL DISPUTES THAT ARISE OUT OF MY EMPLOYMENT IN AN ARBITRATION OF MY INDIVIDUAL CLAIMS, ALONE. I RECOGNIZE THAT ANY SUCH DISPUTES MUST BE BROUGHT TO ARBITRATION WITHIN TWO YEARS OR ARE FOREVER WAIVED.
Do not sign until you have read the agreement and the above acknowledgment.
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