Filed 12/13/17 (unmodified opn. attached)

CERTIFIED FOR PUBLICATION

IN THE COURT OF APPEAL OF THE STATE OF CALIFORNIA

SECOND APPELLATE DISTRICT

DIVISION FOUR

MALISSA JULIAN et al.,

Plaintiffs and Respondents,

v.

GLENAIR, INC.,

Defendant and Appellant.

 B277064

 (Los Angeles County

 Super. Ct. No. BC597683)

 

 

 ORDER MODIFYING

 OPINION AND DENYING

 PETITION FOR REHEARING

 

 [NO CHANGE IN

 JUDGMENT]

THE COURT:*

It is ordered that the opinion filed herein on November 27, 2017 be 

modified as follows: 

On page 4, line 8, after “[the Rojas action].”, insert the following 

footnote: 

“The proposed agreement further provided that “to the extent 

permitted by law, for any claims for which you are seeking relief 

as a private attorney general on behalf of a government entity as a 

representative action, both you and [Glenair] agree that any such 

dispute shall be resolved on an individual basis only under this 
2

Program . . . , and that such an action may not be used to resolve 

the claims or rights of other employees or individuals in a single 

proceeding . . . .”” 

On page 19, lines 10 though 20, delete: 

“Here, the arbitration agreement also contains a provision barring 

such claims, but Glenair’s petition to compel did not attempt to 

enforce that provision. Rather, before the trial court and on 

appeal, Glenair has contended only that the agreement obliges 

respondents to submit their PAGA claim as a whole to 

arbitration. 

In order to resolve Glenair’s contention, we must examine 

the circumstances under which employees may agree to arbitrate 

PAGA claims, thereby waiving their right to assert those claims 

in a judicial forum.” 

And substitute:

“Here, the arbitration agreement also bars such claims “to the

extent permitted by law,” but Glenair’s petition to compel

requested only an order that respondents submit their claims to 

arbitration as required under the agreement, and a stay of court 

proceedings. For the reasons explained below, we conclude that

to the extent the petition sought arbitration of respondents’

claims, the agreement constituted an unenforceable predispute 

waiver of respondents’ right to litigate their claims in court. In 

view of Iskanian, our conclusion necessarily implies as a 

corollary that the agreement also constituted an unenforceable 

predispute waiver of respondents’ right to assert PAGA claims on 

behalf of other employees in any forum. (Iskanian, supra, 59 

Cal.4th at pp. 382-383.) The focus of our inquiry is therefore on 

the predispute/postdispute boundary relating to agreements that 

require arbitration of PAGA claims in lieu of litigation in court. 

 In order to resolve that issue, we must examine the 

circumstances under which employees may agree to arbitrate 
3

PAGA claims, thereby waiving their right to assert those claims 

in a judicial forum.” 

Glenair’s petition for rehearing is denied. The modification does not 

change the judgment.

_________________________________________________________________

*EPSTEIN, P. J. WILLHITE, J. MANELLA, J.
Filed 11/27/17 (unmodified version)

CERTIFIED FOR PUBLICATION

IN THE COURT OF APPEAL OF THE STATE OF CALIFORNIA

SECOND APPELLATE DISTRICT

DIVISION FOUR

MALISSA JULIAN et al.,

Plaintiffs and Respondents,

v.

GLENAIR, INC.,

Defendant and Appellant.

 B277064

 (Los Angeles County

 Super. Ct. No. BC597683)

APPEAL from an order of the Superior Court of Los 

Angeles County, John Shepard Wiley, Jr., Judge. Affirmed.

Gibson, Dunn & Crutcher, Jesse A. Cripps, Sarah E. 

Gerdes, and Sarah Zenewicz for Defendant and Appellant.

Matern Law Group, Matthew J. Matern and Tagore 

Subramaniam for Plaintiffs and Respondents.

__________________________________
2

Appellant Glenair, Inc., challenges the denial of its motion to 

compel arbitration of respondents’ claim under the Labor 

Code Private Attorneys General Act of 2004 (PAGA; Lab. 

Code, § 2698 et seq.). Glenair contends an agreement 

respondents executed during their employment with the 

company was an enforceable postdispute agreement 

obligating them to arbitrate the claim. We hold that an 

agreement to arbitrate a PAGA claim, entered into before an 

employee is statutorily authorized to bring such a claim on 

behalf of the state, is an unenforceable predispute waiver. 

As any agreement by respondents was entered into before 

they were authorized to bring a PAGA claim, the trial court 

properly denied the petition to compel. 

RELEVANT FACTUAL AND

PROCEDURAL BACKGROUND

A. Events Preceding Underlying Action 

Respondents Malissa and Machele Julian began their

employment with Glenair, respectively, in 2012 and 2013.1 

In April 2013, an action was commenced against Glenair 

(L.A. County Super. Ct. Case No. BC505602) in which 

Roxane Rojas was ultimately identified as the principal 

named plaintiff (the Rojas action). Rojas’s first amended 

complaint, filed February 14, 2014, asserted putative class 

1 As respondents share their surname and are sisters, 

we refer to them by their first names. 
3

claims based on alleged violations of the Labor Code and the 

unfair competition law (Bus. & Prof. Code, § 17200 et seq.), 

as well as a PAGA claim for civil penalties. 

In July 2014, Glenair served its hourly employees with 

a proposed arbitration agreement entitled “Glenair Dispute 

Resolution Program.” The proposed agreement informed 

employees that if they did not “opt out,” their continued 

employment with Glenair manifested consent to mandatory 

arbitration of a broad range of claims, including claims for 

wages or other compensation due, meal or rest periods, and 

“violation of applicable federal, state or local law, statute, 

ordinance, or regulation. The proposed agreement further 

stated that it was governed by the Federal Arbitration Act 

(FAA; 9 U.S.C. § 1 et seq.), and that the parties’ intent was 

that “the FAA shall preempt all [s]tate laws to the fullest 

extent permitted by law.” 

In bold capital letters with underlining, the proposed 

agreement provided: “Your decision to participate in the 

[program] is completely voluntary. You may opt[]out of the 

[program] within 30 calendar days of receipt. Your decision 

to participate or not participate in the program will have no 

effect on your work with Glenair. If you do not opt[]out . . . :

(1) Mandatory arbitration is your . . . sole and exclusive 

means of resolving past, present, and future claims, 

controversies, and disputes between you and the 

company covered by this program;
4

(2) You will not be able to participate in any class or 

collective action covered by this program, including 

. . . [the Rojas action]; and 

(3) To the extent permitted by law, you will not be able 

to participate in any representative action that seeks to 

resolve whether individuals other than you have been 

subject to violations of the law, including . . . [the Rojas

action].”

The proposed agreement contained a description of the 

claims then asserted in the Rojas action, including the 

PAGA claim. 

On July 16, 2014, Glenair distributed copies of the 

proposed agreement to its hourly employees by first class 

mail. When the copy sent to Machele was returned as 

undeliverable, Stephen Bruce, an attorney employed by 

Glenair, personally observed her supervisor give her a copy 

of the proposed agreement. Neither respondent took any 

action to opt out of the proposed agreement. 

In January 2015, respondents’ employment was 

terminated. In late 2014 or early 2015, a third amended 

complaint was filed in the Rojas action that asserted no 

PAGA claim. In April 2015, attorney Bruce received a copy 

of a proposed fourth amended complaint in the Rojas action, 

which identified respondents as additional named plaintiffs

and contained a PAGA claim. Later, in May 2015, Glenair 

sent a demand for arbitration to respondents and their 

counsel, who also represented the existing named plaintiffs 
5

in the Rojas action. Respondents did not answer the 

demand for arbitration, and the proposed fourth amended 

complaint in the Rojas action was never filed. 

B. Underlying Action

In October 2015, respondents initiated the underlying 

action against Glenair. Their complaint contains a single

claim under PAGA for civil penalties “on behalf of 

themselves and other current and former non-exempt 

employees” of appellants. The claim is predicated on alleged 

violations of the Labor Code and Industrial Welfare 

Commission Wage Order No. 1-2001 (Wage Order 1-2001).2

The complaint asserts that respondents are “‘aggrieved 

employees’” for purposes of a representative action under 

PAGA, and that they complied with the requirements for 

commencing a representative action under PAGA. 

2 The claim seeks penalties for failure to provide meal 

and rest periods (Lab. Code, § 226.7; Wage Order No. 1-2001, 

§§ 11-12), failure to pay overtime wages (Lab. Code, §§ 510, 

1194, 1198; Wage Order No. 1-2001, § 3), failure to pay 

minimum wages (Lab. Code, §§ 1194, 1198; Wage Order No. 

1-2001, § 4 ), failure to pay timely wages (Lab. Code, § 204), 

failure to pay all wages due to former employees (Lab. Code, 

§§ 201, 202, 203), failure to maintain records (Lab. Code 

§§ 226, subd. (a), 1174, subd. (d); Wage Order No. 1-2001, 

§ 7), failure to furnish itemized wage statements (Lab. Code, 

§ 226, subd. (a); Wage Order No. 1-2001, § 7), and failure to 

indemnify employees for work-related expenses (Lab. Code, 

§ 2802).
6

Glenair filed a petition for an order to compel 

arbitration of respondents’ claim (Code Civ. Proc., § 1281.2). 

Relying on Iskanian v. CLS Transportation Los Angeles, 

LLC (2014) 59 Cal.4th 348, 382 (Iskanian), Glenair 

maintained that respondents, in the course of their 

employment, signed an enforceable voluntary postdispute 

arbitration agreement that encompassed their claim. 

Glenair argued that in Iskanian, our Supreme Court 

prohibited predispute waivers of PAGA claims, but approved 

postdispute waivers of PAGA claims by employees aware of 

Labor Code violations. 

Respondents opposed the petition, contending they 

entered into no enforceable agreement requiring arbitration 

of their PAGA claim. They argued that they were insufficiently aware of their right to assert a PAGA claim when 

they failed to opt out of the proposed agreement. Additionally, they argued that the agreement was unenforceable due 

to procedural and substantive unconscionability. 

In support of those contentions, respondents relied on 

their own declarations. Malissa stated that prior to her 

termination, she never received the proposed arbitration 

agreement, and had no knowledge of the proposed 

agreement, the Rojas action, and her potential claims 

against Glenair. Machele stated that in July 2014, her boss 

handed her the proposed arbitration agreement. She tried to 

read it but did not understand it, and decided that she did 

not want to participate in the dispute resolution program. 

She took no further action, believing that the agreement 
7

would bind her only if she signed it. Machele further stated 

that prior to her termination, she was unaware of the Rojas

action and her potential claims against Glenair. 

On April 18, 2016, the trial court issued a tentative 

ruling denying Glenair’s petition. The court first discussed 

Iskanian and its progeny, stating: “Iskanian establishes that 

a predispute arbitration clause . . . cannot be used to compel 

arbitration of PAGA claims.” Turning to the subject of 

postdispute waivers, the court stated: “Conceivably, our 

Supreme Court would allow postdispute arbitration 

agreements to cover PAGA claims because, at that point, an 

employee would be represented by counsel who could weigh 

the benefits and risks of proceeding in arbitration rather 

than superior court. [¶] In this case, [respondents] were not 

represented by counsel when they allegedly agreed to 

arbitration.” On October 6, 2016, at the parties’ request, the 

court entered the tentative ruling as its final order.3 

3 Glenair’s notice of appeal was premature, as the appeal 

was taken from an August 3, 2016 announcement on the 

trial court’s message board that the tentative ruling was the 

court’s order, rather than from a final ruling entered in the 

court records. (7 Witkin, Cal. Procedure (5th ed. 2008) 

Judgment, § 54, p. 590 [a ruling does not become effective 

until filed in writing or entered in the minutes].) However, 

because respondents did not object to the premature notice 

of appeal and instead joined Glenair in requesting the entry 

of a final order, we find good cause to treat the notice as 

having been filed immediately after the October 6, 2016 

(Fn. is continued on the next page.)
8

DISCUSSION

Glenair challenges the denial of its petition to compel 

arbitration, arguing that under Iskanian, the agreement at 

issue constituted an enforceable postdispute arbitration 

agreement encompassing respondents’ PAGA claim. For the 

reasons discussed below, we affirm the denial because the 

agreement is an unenforceable predispute agreement. 

A. Standard of Review

A petition to compel arbitration is a suit in equity 

seeking specific performance of an arbitration agreement. 

(Hotels Nevada, LLC v. L.A. Pacific Center, Inc. (2012) 203 

Cal.App.4th 336, 347.) Under Code of Civil Procedure 

section 1281.2, a petition to compel arbitration of a claim 

may be denied when the arbitration agreement is 

unenforceable (Robertson v. Health Net of California, Inc.

(2005) 132 Cal.App.4th 1419, 1425 (Robertson)) or the claim 

is not subject to the arbitration agreement (Fitzhugh v. 

Granada Healthcare & Rehabilitation Center, LLC (2007) 

150 Cal.App.4th 469, 474 (Fitzhugh); see Sky Sports, Inc. v. 

Superior Court (2011) 201 Cal.App.4th 1363, 1367-1368). 

Generally, the standard of review applicable to the 

denial of a petition to compel arbitration is determined by 

the issues presented on appeal (Robertson, supra, 132 

 

order. (Cal. Rules of Court, rule 8.104(d)(2)); Stonewall Ins. 

Co. v. City of Palos Verdes Estates (1996) 46 Cal.App.4th 

1810, 1827-1828.)
9

Cal.App.4th at p. 1425). To the extent the denial relies on a 

pertinent factual finding, we review that finding for the 

existence of substantial evidence.4 (Nyulassy v. Lockheed 

Martin Corp. (2004) 120 Cal.App.4th 1267, 1277.) In 

contrast, to the extent the denial relies on a determination of 

law, we review the trial court’s resolution of that 

determination de novo. (Ibid.) Nonetheless, we are not 

bound by the trial court’s rationale, and thus may affirm the 

denial on any correct legal theory supported by the record, 

even if the theory was not invoked by the trial court. (Shaw 

v. County of Santa Cruz (2008) 170 Cal.App.4th 229, 268-

269; Cheng-Canindin v. Renaissance Hotel Associates (1996) 

50 Cal.App.4th 676, 683, fn. 3; Chan v. Drexel Burnham 

Lambert, Inc. (1986) 178 Cal.App.3d 632, 645 & fn. 6; see 

4 Glenair was entitled to request a statement of decision 

regarding the denial, but did not do so. (Acquire II, Ltd. v. 

Colton Real Estate Group (2013) 213 Cal.App.4th 959, 970.) 

Generally, the failure to request a statement of decision 

triggers the doctrine of implied factual findings, under which 

the appellate court “presumes the trial court made all 

necessary findings supported by substantial evidence.” 

(Ibid.) In applying that doctrine, we would ordinarily infer 

that the trial court resolved contested factual issues -- for 

example, whether Malissa received the proposed agreement 

and whether Machele understood it -- in a manner favorable 

to the trial court’s ruling. However, we do not employ the 

doctrine because -- as we explain below -- the ruling is 

properly affirmed on a ground established by the record but 

not set forth in the trial court’s order.
10

J.B. Aguerre, Inc. v. American Guarantee & Liability Ins. Co.

(1997) 59 Cal.App.4th 6, 15-16.) 

The parties disagree regarding the trial court’s 

rationale for its ruling, and thus dispute the applicable 

standard of review. Their disagreement relates to whether 

the court actually found that the arbitration agreement in 

question was a postdispute -- rather than a predispute --

agreement. Glenair asserts that its contention on appeal 

requires de novo review, arguing that the court correctly 

recognized the arbitration agreement to be a postdispute 

agreement, but made an erroneous determination of law, 

namely, that the agreement was unenforceable because 

respondents were unrepresented by counsel when they failed 

to opt out of the proposed agreement. In contrast, 

respondents maintain that the court’s ruling may be 

affirmed on several grounds requiring different standards of 

review. Their principal contention is that the court correctly 

found that the agreement was a predispute agreement 

unenforceable under Iskanian. 

A careful reading of the trial court’s order reveals that 

the court did not resolve whether any agreement was 

predispute or postdispute, but concluded that the “alleged[]” 

agreement was unenforceable regardless. The court’s 

apparent rationale for the ruling was (1) that if the 

“alleged[]” agreement was a predispute agreement, it was

unenforceable under Iskanian, and (2) that if it was a 

postdispute agreement, it was unenforceable due to an 

undisputed fact, namely, respondents’ lack of representation. 
11

As explained below (see pt. D. of the Discussion, post), we 

conclude that the record discloses an unenforceable 

predispute agreement.

 

B. PAGA

We begin by setting forth the relevant elements of 

PAGA. Under the Labor Code, the California Labor and 

Workforce Development Agency (LWDA) and its constituent 

departments and divisions are authorized to collect civil 

penalties for specified labor law violations by employers. 

(Caliber Bodyworks, Inc. v. Superior Court (2005) 134 

Cal.App.4th 365, 370 (Caliber Bodyworks).) To enhance the 

enforcement of the labor laws, the Legislature enacted 

PAGA. (Caliber Bodyworks, supra, at p. 370.) PAGA 

permits aggrieved employees to recover civil penalties that 

previously could be collected only by the LWDA, as well as 

newly established “default” penalties. (Dunlap v. Superior 

Court (2006) 142 Cal.App.4th 330, 335; Caliber Bodyworks, 

supra, at p. 375; Lab. Code, § 2699, subds. (a), (f).) 

Under PAGA, “an ‘aggrieved employee’ may bring a 

civil action personally and on behalf of other current or 

former employees to recover civil penalties for Labor Code 

violations. [Citation.][] Of the civil penalties recovered, 75 

percent goes to the [LWDA], leaving the remaining 25 

percent for the ‘aggrieved employees.’ [Citation.]” (Arias v. 

Superior Court (2009) 46 Cal.4th 969, 980-981 (Arias), fn. 

omitted.) As the LWDA has “the initial right to prosecute 

and collect civil penalties” under the Labor Code, PAGA 
12

requires aggrieved employees to provide a specified notice to 

LWDA before asserting a PAGA claim. (Caliber Bodyworks, 

Inc., supra, 134 Cal.App.4th at pp. 376-377.) 

PAGA actions are “a substitute for an action by the 

government itself,” in which the aggrieved employee acts as 

“the proxy or agent of the state’s labor law enforcement 

agencies.” (Arias, supra, 46 Cal.4th at p. 986.) As explained 

in Iskanian, “[a] representative PAGA claim is a type of qui 

tam action. ‘Traditionally, the requirements for enforcement 

by a citizen in a qui tam action have been (1) that the statute 

exacts a penalty; (2) that part of the penalty be paid to the 

informer; and (3) that, in some way, the informer be 

authorized to bring suit to recover the penalty.’ [Citation.] 

The PAGA conforms to these traditional criteria, except that 

a portion of the penalty goes not only to the citizen bringing 

the suit but to all employees affected by the Labor Code 

violation.” (Iskanian, supra, 59 Cal.4th at p. 382.)

5

5 We observe that Iskanian applies the term 

“representative” to PAGA claims in two distinct ways. 

Iskanian characterizes PAGA claims as representative 

because they are brought by employees acting as 

representatives -- that is, as agents or proxies -- of the state. 

(Iskanian, supra, 59 Cal.4th at p. 387.) Iskanian also 

describes an employee’s PAGA claim as representative when 

it seeks penalties on behalf of other employees. (Iskanian, 

supra, at pp. 383-384.) When necessary, we clarify the 

meaning of “representative” applicable to our analysis.
13

Labor Code section 2699.3, subdivision (a), sets forth 

the procedures with which an aggrieved employee must 

comply in order to commence a PAGA action of the type 

asserted by respondents. During the period pertinent here, 

the required procedures were as follows: “The aggrieved 

employee must ‘give written notice of the alleged Labor Code 

violation to both the employer and the [LWDA], and the 

notice must describe facts and theories supporting the 

violation. [Citation.] If the agency notifies the employee and 

the employer that it does not intend to investigate . . . , or if 

the agency fails to respond within 33 days, the employee 

may then bring a civil action against the employer. 

[Citation.] If the agency decides to investigate, it then has 

120 days to do so. If the agency decides not to issue a 

citation, or does not issue a citation within 158 days after 

the postmark date of the employee’s notice, the employee 

may commence a civil action.” (Thurman v. Bayshore 

Transit Management, Inc. (2012) 203 Cal.App.4th 1112, 

1148-1149, quoting Arias, supra, 46 Cal.4th at p. 981.)

Two features of PAGA claims are notable here. Under 

the PAGA statutory scheme, an employee authorized to 

assert a PAGA action is not subject to LWDA supervision. 

(Iskanian, supra, 59 Cal.4th at pp. 389-390.) In Iskanian, 

our Supreme Court held that the lack of supervision does not 

contravene the constitutional principle of separation of 

powers, concluding that in view of scarce budgetary

resources, the Legislature’s enactment of PAGA represented 

a legitimate choice “to deputize and incentivize employees 
14

uniquely positioned to detect and prosecute [Labor Code] 

violations.” (Iskanian, supra, at p. 390.) The court rejected 

the contention that PAGA actions represent an abuse of 

governmental power, stating that a PAGA plaintiff, like a 

qui tam plaintiff, “has only his or her own resources and may 

incur significant cost if unsuccessful.” (Iskanian, supra, at 

p. 391.)

Furthermore, nothing in the PAGA statutory scheme 

forecloses separate but similar actions by different 

employees against the same employer. (Tan v. GrubHub, 

Inc. (N.D. Cal. 2016) 171 F.Supp.3d 998, 1012-1013 (Tan).) 

Our Supreme Court has explained that the doctrine of 

collateral estoppel, rather than the statutory scheme, shields 

the employer from an abusive “‘one-way intervention,’” that 

is, a series of PAGA actions by different employees that 

would continue until some employee prevailed. (Arias, 

supra, 46 Cal.4th at pp. 984-987.) Because an employee’s 

PAGA action “functions as a substitute for an action brought 

by the government itself,” under the doctrine of collateral 

estoppel, a judgment unfavorable to the employee binds the 

government, as well as all aggrieved nonparty employees 

potentially entitled to assert a PAGA action. (Arias, supra,

at p. 986.) 

C. Iskanian

We turn to the discussion of PAGA claim waivers in 

Iskanian. There, the plaintiff, in the course of his 

employment, signed an agreement subject to the FAA,
15

providing that all claims arising out his employment were to 

be submitted to arbitration. (Iskanian, supra, 59 Cal.4th at 

p. 360.) The agreement further provided that the parties 

would not assert representative claims against each other. 

(Ibid.) When the plaintiff alleged claims against his 

employer for Labor Code violations, including a PAGA claim, 

the trial court granted the employer’s petition to compel 

arbitration, concluding that the plaintiff was obliged to 

arbitrate the PAGA claim, and was barred from litigating

that claim on behalf of employees other than himself. 

(Iskanian, supra, at pp. 361-362.) 

Our Supreme Court examined two related questions, 

namely, whether arbitration agreements obliging employees 

to waive their right to bring representative PAGA actions in 

any forum are unenforceable under state law, and whether 

the FAA preempts any state law rule precluding such 

waivers. (Iskanian, supra, 59 Cal.4th at pp. 382-383.) 

Regarding the first question, the court held that predispute 

waivers -- that is, waivers made “before any dispute arises”

-- requiring employees as a condition of employment to give 

up the right to assert a PAGA claim on behalf of other 

employees, are unenforceable, concluding that they “harm 

the state’s interest in enforcing the Labor Code,” and thus 

are contrary to public policy. (Iskanian, supra, at pp. 360-

361, 383-384, 388.) Although the court recognized that the 

plaintiff’s waiver potentially permitted him to assert an 

individualized PAGA claim, the court declined to decide 

whether such a claim was cognizable, stating that “a 
16

prohibition of representative claims” -- that is, claims on 

behalf of other employees -- “frustrates the PAGA’s 

objectives.” (Iskanian, at p. 384, italics omitted.) 

Regarding the second question, the court held that the 

FAA did not preempt the state law rule invalidating waivers 

of the type described above, stating: “[A] PAGA claim lies 

outside the FAA’s coverage because it is not a dispute 

between an employer and an employee arising out of their 

contractual relationship. It is a dispute between an 

employer and the state, which alleges directly or through its 

agents -- either the [LWDA] or aggrieved employees -- that 

the employer has violated the Labor Code.” (Iskanian, supra, 

59 Cal.4th at p. 386.) The court explained: “[T]he FAA aims 

to promote arbitration of claims belonging to the private 

parties to an arbitration agreement. It does not aim to 

promote arbitration of claims belonging to a government 

agency, and that is no less true when such a claim is brought 

by a statutorily designated proxy for the agency as when the 

claim is brought by the agency itself. The fundamental 

character of the claim as a public enforcement action is the 

same in both instances.” (Id. at p. 388.)

Our focus is on the Supreme Court’s rationale for 

limiting its holding to predispute waivers. In examining the 

extent to which the right to assert a PAGA claim may be 

waived, the court relied on Civil Code section 1668, which 

invalidates contracts that exempt their parties from 

“violation[s] of law,” and Civil Code section 3513, which 

invalidates private contracts that contravene “a law 
17

established for a public reason . . . .”

6 (Iskanian, supra, 59 

Cal.4th at pp. 382-383.) Applying those statutes, the court 

determined that a waiver of the right to assert a PAGA claim 

in any forum “disable[d] one of the primary mechanisms for 

enforcing the Labor Code” and harmed the state’s interests 

in enforcing that code. (Iskanian, supra, at p. 383.)

The court nonetheless imposed a limit on its 

determination, stating: “Of course, employees are free to 

choose whether or not to bring PAGA actions when they are 

aware of Labor Code violations. [Citation.] But it is 

contrary to public policy for an employment agreement to 

eliminate this choice altogether by requiring employees to 

waive the right to bring a PAGA action before any dispute 

arises.” (Iskanian, supra, 59 Cal.4th at p. 383.) In support 

of this remark, the court pointed to footnote 8 in Armendariz 

v. Foundation Health Psychcare Services, Inc. (2000) 24 

Cal.4th 83, 103, fn. 8 (Armendariz) as authority for the 

proposition that “waivers freely made after a dispute has 

6 Civil Code section 1668 provides that “[a]ll contracts 

which have for their object, directly or indirectly, to exempt 

anyone from responsibility for his own fraud, or willful 

injury to the person or property of another, or violation of 

law, whether willful or negligent, are against the policy of 

the law.”

Civil Code section 3513 states: “Any one may waive 

the advantage of a law intended solely for his benefit. But a 

law established for a public reason cannot be contravened by 

a private agreement.”
18

arisen are not necessarily contrary to public policy.” 

(Iskanian, supra, 59 Cal.4th at p. 383.) 

The footnote in question occurs in the context of a 

discussion of the arbitrability of claims under the California 

Fair Employment and Housing Act (FEHA; Gov. Code, 

§ 12900 et seq.). In Armendariz, two employees executed 

arbitration agreements as a condition of their employment. 

(Armendariz, supra, 24 Cal.4th at pp. 91-92.) After they 

asserted FEHA claims against the employer, the trial court 

denied the employer’s petition to compel arbitration, 

concluding that the agreement was unenforceable. 

(Armendariz, supra, at pp. 92-93.) Applying Civil Code 

sections 1668 and 3513, our Supreme Court determined that 

an arbitration agreement may not operate to waive FEHA 

statutory rights implementing the public policy against 

discrimination. (Armendariz, supra, at pp. 100-101.) The 

court nonetheless concluded that an agreement to arbitrate 

FEHA claims was potentially enforceable if it imposed 

requirements on arbitration sufficient to preserve the 

unwaiveable FEHA rights. (Armendariz, at pp. 102-103.)

In the pertinent footnote in Armendariz, the court 

explained that those requirements related to mandatory 

employment arbitration agreements. (Armendariz, supra, 24 

Cal.4th at p. 103, fn. 8.) The court stated: “These 

requirements would generally not apply in situations in 

which an employer and an employee knowingly and 

voluntarily enter into an arbitration agreement after a 

dispute has arisen. In those cases, employees are free to 
19

determine what trade-offs between arbitral efficiency and 

formal procedural protections best safeguard their statutory 

rights.” (Ibid.) 

D. Analysis

We confront an issue regarding the waivability of 

PAGA claims that is distinct from the issue presented in 

Iskanian. There, the employer sought to enforce an 

employee’s waiver of the right to assert a PAGA claim on 

behalf of other employees in any forum. Here, the 

arbitration agreement also contains a provision barring such 

claims, but Glenair’s petition to compel arbitration did not 

attempt to enforce that provision. Rather, before the trial 

court and on appeal, Glenair has contended only that the 

agreement obliges respondents to submit their PAGA claim 

as a whole to arbitration. 

In order to resolve Glenair’s contention, we must 

examine the circumstances under which employees may 

agree to arbitrate PAGA claims, thereby waiving their right 

to assert those claims in a judicial forum. As discussed 

further below, at least two appellate courts have concluded 

that predispute agreements to arbitrate PAGA claims are 

unenforceable for reasons that we find persuasive. 

(Betancourt v. Prudential Overall Supply (2017) 9 

Cal.App.5th 439, 445-446 (Betancourt); Tanguilig v. 

Bloomingdale’s, Inc. (2016) 5 Cal.App.5th 665, 678 

(Tanguilig).) Accordingly, with respect to waivers of the 

right to assert a PAGA claim in a judicial forum, the key 
20

issue concerns the boundary between an unenforceable 

predispute waiver and an enforceable postdispute waiver. 

The parties have not identified -- and our research had not 

disclosed -- any decision addressing that issue. 

However, although Iskanian does not draw the boundary in 

question, it establishes that the boundary is determined by 

two factors, namely, the employee’s capacity to make a 

knowing and voluntary choice of forum based on an adequate 

awareness of Labor Code violations supporting a PAGA 

claim, and the absence of public policy considerations

attendant to the loss of the judicial forum (see pt. C. of the 

Discussion, ante).

Those factors dictate that the predispute/postdispute 

boundary is crossed when the pertinent employee is 

authorized to commence a PAGA action as an agent of the 

state. Generally, a waiver of a statutory right is not 

enforceable unless -- at minimum -- “‘it appears that the 

party executing it ha[s] been fully informed of the existence 

of that right, its meaning, [and] the effect of the “waiver” 

presented to him’” (Hittle v. Santa Barbara County 

Employees Retirement Assn. (1985) 39 Cal.3d 374, 389, 

quoting Bauman v. Islay Investments (1973) 30 Cal.App.3d 

752, 758). Only after employees have satisfied the statutory 

requirements for commencing a PAGA action are they in a 

position “to determine what trade-offs between arbitral 

efficiency and formal procedural protections best safeguard 

their statutory rights.” (Armendariz, supra, 24 Cal.4th at p. 

103, fn. 8.) Prior to that point, the employees either have 
21

submitted no allegations of Labor Code violations to LWDA, 

or have done so, but await LWDA’s determination regarding 

the extent to which LWDA itself will resolve the allegations

(see Tan, supra, 171 F.Supp.3d at p. 1012 [explaining that 

PAGA bars employee from asserting claim based on a 

violation for which LWDA has cited employer]). Accordingly, 

before meeting the statutory requirements for commencing a 

PAGA action, employees do not know which alleged 

violations -- if any -- they are authorized to assert in the 

action. Enforcing a waiver secured at that time would 

effectively dictate a choice of forum the employee did not 

knowingly make. 

Enforcing a waiver executed before the employee has 

satisfied the statutory requirements would also impair 

PAGA’s enforcement mechanism. As explained below, until 

the employee meets those requirements, the state -- through 

LWDA -- retains control of the right underlying the 

employee’s PAGA claim. For that reason, enforcing the 

arbitration agreement would contravene the state’s control

over that right. 

Although Iskanian did not expressly examine the 

circumstances under which parties may lawfully agree to 

subject PAGA claims to arbitration, it characterized a PAGA 

claim as a dispute between the state and the employer, in 

which the plaintiff acts as the agent of the state.

7 (Iskanian, 

7 We recognize that in Iskanian, the court, in remanding 

the matter before it for further proceedings, suggested that 

(Fn. is continued on the next page.)
22

supra, 59 Cal.4th at pp. 386-389.) Following Iskanian, two 

appellate courts have concluded that a predispute agreement 

to arbitrate is ineffective to compel arbitration of a PAGA 

claim, as the employee who signs the agreement is not then 

authorized to waive the state’s right to a judicial forum. 

(Betancourt, supra, 9 Cal.App.5th at pp. 445-448; [PAGA 

action not subject to arbitration, as state not bound by 

employee’s predispute agreement]; Tanguilig, supra, 5 

Cal.App.5th at pp. 677-680 [PAGA claim cannot be 

arbitrated pursuant to predispute arbitration agreement 

without state’s consent].) We agree. 

In Iskanian, our Supreme Court explained that “every

PAGA action, whether seeking penalties for Labor Code 

violations as to only one aggrieved employee -- the plaintiff 

bringing the action -- or as to other employees as well, is a 

representative action on behalf of the state.” (Iskanian, 

 

the parties might properly agree to arbitration of the 

plaintiff’s PAGA claim, stating: “[The defendant] must 

answer the representative PAGA claim[]”-- that is, the claim 

seeking penalties on behalf of the plaintiff and other 

employees -- “in some forum.” (Iskanian, supra, 59 Cal.4th 

at p. 391.) Neither these remarks, nor any others in 

Iskanian, purport to address when an agreement to arbitrate 

a PAGA claim constitutes an enforceable postdispute 

agreement, as they are unaccompanied by any discussion of 

that issue. (See Santa Clara County Local Transportation 

Authority v. Guardino (1995) 11 Cal.4th 220, 243 [“[A]n 

opinion is not authority for an issue not considered 

therein”].)
23

supra, 59 Cal.4th at p. 387, quoting id. at p. 394, conc. opn. 

of Chin, J.) A PAGA action is thus ultimately founded on a 

right belonging to the state, which -- though not named in 

the action -- is the real party in interest. (Iskanian, supra, 

at p. 387.) That is because PAGA does not create any new 

substantive rights or legal obligations, but “is simply a 

procedural statute allowing an aggrieved employee to 

recover civil penalties -- for Labor Code violations -- that 

otherwise would be sought by state labor law enforcement 

agencies.” (Amalgamated Transit Union, Local 1756, AFLCIO v. Superior Court (2009) 46 Cal.4th 993, 1003.) 

Ordinarily, when a person who may act in two legal 

capacities executes an arbitration agreement in one of those 

capacities, the agreement does not encompass claims the 

person is entitled to assert in the other capacity. (Fitzhugh, 

supra, 150 Cal.App.4th at pp. 474-475 [son who executed 

arbitration agreement for father did not subject his own 

claims as an individual to arbitration]; Benasra v. Marciano

(2001) 92 Cal.App.4th 987, 990 [corporate officer who 

executed arbitration agreement as agent for the corporation 

did not subject his claims as individual to arbitration]; see 

Goliger v. AMS Properties, Inc. (2004) 123 Cal.App.4th 374, 

377 [daughter who executed arbitration agreement relating 

to mother’s medical treatment solely as party responsible for 

mother’s medical payments, and not as mother’s agent, did 

not subject mother’s claims to arbitration].) That rule 

reflects general principles regarding the significance of legal 

capacities. (Benasra, supra, at p. 990.) 
24

Under the rule set forth above, an arbitration 

agreement executed before an employee meets the statutory 

requirements for commencing a PAGA action does not 

encompass that action. Prior to satisfying those 

requirements, an employee enters into the agreement as an 

individual, rather than as an agent or representative of the 

state. As an individual, the employee is not authorized to 

assert a PAGA claim; the state -- through LWDA -- retains 

control of the right underlying any PAGA claim by the 

employee. Thus, such a predispute agreement does not 

subject the PAGA claim to arbitration. (See Betancourt, 

supra, 9 Cal.App.5th at p. 448; Tanguilig, supra, 5 

Cal.App.5th at pp. 677-680; Mikes v. Strauss (S.D.N.Y. 1995) 

889 F.Supp. 746, 755 [arbitration agreement plaintiff 

executed as an individual did not encompass plaintiff’s qui 

tam claim as a “private representative of the government” 

because “the government was not a party to the 

[a]greement”].) For that reason, enforcing any such 

agreement would impair PAGA’s enforcement mechanism. 

Here, the record establishes that Glenair distributed 

the proposed agreement to respondents and other employees 

in July 2014, long before respondents initiated the procedure 

for becoming the state’s agents by submitting a notice of 

Labor Code violations to the LWDA in April 2015. As the 

proposed agreement required employees to opt out within 30 

days, it necessarily constituted a predispute arbitration 

agreement with respect to respondents’ PAGA action. The 

court thus did not err in declining to enforce it. 
25

Glenair maintains that the arbitration agreement must 

be regarded as an enforceable postdispute agreement, 

arguing that the agreement described the Labor Code 

violations and PAGA claim alleged in the Rojas action, and 

that respondents’ action asserts an essentially similar PAGA 

claim. According to Glenair, the Rojas action and the 

underlying action involve the same dispute, for purposes of 

classifying the agreement as “predispute” or “postdispute.” 

The crux of Glenair’s contention is that after the Rojas

plaintiff was authorized to assert a PAGA claim against 

Glenair and Glenair’s other employees received suitable 

notice of that fact, the predispute/postdispute boundary was 

crossed with respect to all the other employees, including 

respondents, relating to any similar PAGA claim by them. 

We disagree. 

In our view, under the principles and public policy 

considerations set forth in Iskanian, the classification of an 

agreement as “predispute” or “postdispute” must be made by 

reference to the point at which an individual employee 

acquires the status of the state’s agent. Although Iskanian

characterized a PAGA claim as a dispute between the state 

and an employer, it identified the PAGA plaintiff as the 

state’s agent in the resolution of the dispute. (Iskanian, 

supra, 59 Cal.4th at pp. 386-387.) As noted above (see pt. B.

of the Discussion, ante), PAGA does not foreclose separate 

but similar actions by different employees against the same 

employer. PAGA thus permits the state -- through LWDA --
26

to designate more than one employee to act as its agent in a 

dispute with a particular employer. 

Because those employees must individually satisfy the 

statutory requirements in order to assert a PAGA claim, the 

principles set forth in Iskanian dictate that with respect to 

each such employee, LWDA retains control of the right 

underlying that employee’s PAGA claim until the employee 

meets the requirements for becoming the state’s agent. 

Accordingly, with respect to each such employee, an 

arbitration agreement executed prior to the satisfaction of 

those requirements cannot encompass the employee’s PAGA 

claim, as the employee is not then the state’s agent. 

We thus reject Glenair’s contention that the Rojas

action and respondents’ action represent the same dispute, 

for purposes of determining whether the arbitration 

agreement constituted an enforceable postdispute 

agreement. Specifically, we reject the contention that once 

the Rojas plaintiff was authorized to assert a PAGA claim, 

the arbitration agreement barred all other employees not so 

authorized -- including respondents -- from initiating PAGA 

actions, even though they were not then designated as the 

state’s agents to assert any specific claim. To accept 

Glenair’s position would be to significantly impair PAGA’s 

enforcement mechanism, which permits the state to act 

through more than one employee with respect to a PAGA 

claim against a particular employer. In sum, the trial court 
27

did not err in denying Glenair’s petition to compel 

arbitration.8

8 In view of our conclusion, it is unnecessary to examine 

additional potential grounds for affirming the trial court’s 

ruling identified in respondents’ brief. 
28

DISPOSITION

The order denying appellants’ petition to compel 

arbitration is affirmed. Respondents are awarded their costs 

on appeal. 

CERTIFIED FOR PUBLICATION

MANELLA, J.

We concur:

EPSTEIN, P. J.

WILLHITE, J.