Court Opinion

ID: 2746870
Source: CourtListenerOpinion
Date Created: 2014-10-31 02:05:05.420872+00
Date Added: 2024-06-11T11:26:11.946213
License: Public Domain

Filed 10/30/14 Woods v. JFK Memorial Hospital CA4/3

                      NOT TO BE PUBLISHED IN OFFICIAL REPORTS
California Rules of Court, rule 8.1115(a), prohibits courts and parties from citing or relying on opinions not certified for
publication or ordered published, except as specified by rule 8.1115(b). This opinion has not been certified for publication
or ordered published for purposes of rule 8.1115.

              IN THE COURT OF APPEAL OF THE STATE OF CALIFORNIA

                                     FOURTH APPELLATE DISTRICT

                                                DIVISION THREE

DAREL D. WOODS,

     Plaintiff and Appellant,                                          G050286

         v.                                                            (Super. Ct. No. INC1205209)

JFK MEMORIAL HOSPITAL, INC.,                                           OPINION

     Defendant and Respondent.

                   Appeal from an order of the Superior Court of Riverside County, John G.
Evans, Judge. Reversed and remanded.
                   Law Office of Joseph Antonelli, Joseph Antonelli, Janelle C. Carney, Jason
Hatcher; Shanberg, Stafford & Bartz, Ross E. Shanberg, Shane C. Stafford, Aaron A.
Bartz; Law Offices of Kevin T. Barnes, Kevin T. Barnes and Gregg Lander for Plaintiff
and Appellant.
                   Littler Mendelson, Elizabeth Staggs-Wilson, Keith A. Jacoby, Henry D.
Lederman and Anthony G. Ly for Defendant and Respondent.
                                          *                  *                  *
              Defendant JFK Memorial Hospital, Inc. (JFK) employed plaintiff Darel D.
Woods as a nurse beginning in September 2005. In 2012, after leaving his employment,
he filed the instant lawsuit as a putative class action, alleging numerous wage and hour
violations under the Labor Code. He also alleged claims under the Unfair Competition
Law (UCL) and the Private Attorney General Act (PAGA). JFK moved to compel
arbitration, arguing Woods had voluntarily signed an arbitration agreement. The trial
court granted the motion. We agree with Woods that based on the undisputed facts the
agreement was both substantively and procedurally unconscionable, and therefore reverse
the court’s order granting JFK’s motion to compel arbitration.
                                              I
                                          FACTS
              Woods worked at JFK as a registered nurse between September 2005 and
July 2012. All of the nurses who worked at JFK during the relevant time were covered
by a collective bargaining agreement (CBA) negotiated between JFK and the Service
Employees International Union. Three different CBAs were in effect during the time
Woods was employed. JFK is, apparently, owned by Tenet.
              At the time he began working for JFK, Woods signed an “Employee
Acknowledgement Form” (Acknowledgment). The Acknowledgement Woods signed
was five paragraphs and approximately 540 words long. Paragraph four states: “In
addition, I acknowledge that I have received and reviewed a copy of the Tenet Fair
Treatment Process [FTP] brochure. I hereby voluntarily agree to use the Company’s Fair
Treatment Process and to submit to final and binding arbitration any and all claims and
disputes that are related in any way to my employment or the termination of my
employment with Tenet. I understand that final and binding arbitration will be the sole
and exclusive remedy for any such claim or dispute against Tenet or its parent, subsidiary
or affiliated companies or entities, and each of its and/or their employees, officers,

                                              2
directors or agents, and that, by agreeing to use arbitration to resolve my dispute, both the
Company and I agree to forego any right we each may have had to a jury trial on issues
covered by the Fair Treatment Process. I also agree that such arbitration will be
conducted before an experienced arbitrator chosen by me and the Company, and will be
conducted under the Federal Arbitration Act and the procedural rules of the American
Arbitration Association (‘AAA’).” The next paragraph outlines the handling of the
arbitration’s costs and states the arbitration agreement may not be modified except by
mutual consent.
              The FTP brochure is eight pages long, and outlines an extensive procedure
employees must engage in before filing for arbitration. The employee must first submit
the dispute to a supervisor, then appeal an adverse decision to the department head, then
appeal to administration, then appeal to an “FTP Committee” prior to seeking arbitration
before a neutral arbitrator at AAA.
              The final three pages of the FTP include information about the arbitration
process. To begin arbitration, the employee must obtain and complete an arbitration
request from the human resources department. This request “will serve to confirm your
and the company’s prior mutual agreement to submit the dispute to final and binding
arbitration.” The FTP also explained certain claims were excluded, including “any non-
waivable statutory claims, which may include wag[]e claims within the jurisdiction of a
local or state labor commissioner. . . . This means you may file such non-waivable
statutory claims with the appropriate agency that has jurisdiction over them if you wish,
regardless of whether you decide to use the FTP to resolve them. However, if such an
agency completes its processing of your action against the company, you must use the
FTP if you wish to pursue your claim . . . .”
              Additionally, the FTP stated it was to be governed by the Federal
Arbitration Act (9 U.S.C. § 1 et seq.) (FAA). Discovery was to be conducted in

                                                3
accordance with the “Employee Dispute Resolution Rules of the AAA.” Representation
by counsel during the pre-arbitration process was not permitted, “although both you and
the company have the right to consult privately with your own counsel at any time at your
own expense.” Further, “[a]ll statements and information made or revealed during the
FTP are confidential, and neither you nor the company may reveal any such information,
except on a ‘need to know’ basis or as permitted or required by law.”
              Three different CBAs were in effect during Woods’s employment, all of
which included a substantially identical provision: “The parties agree that nothing in this
Agreement shall affect the enforceability of any Registered Nurse’s existing agreement to
be bound by the Tenet Fair Treatment Process (‘FTP’), including by either final and
binding arbitration, under the American Arbitration Association’s Employee Dispute
Resolution Rules with respect to any dispute not otherwise arbitrable under the Collective
Bargaining Agreement. The parties further agree that the Employer may request that any
currently employed or newly-hired Registered Nurse voluntarily execute an
acknowledgement form likewise agreeing to be bound by the FTP with respect to any
disputes not otherwise arbitrable under this collective bargaining agreement. No
retaliation or adverse action may be taken against anyone who exercises the option not to
sign the FTP. . . . Nothing herein shall preclude any Registered Nurse or the Employer
from seeking to challenge or enforce the FTP, including the obligation to arbitrate.”
              After his employment with JFK ended, Woods filed the instant case as a
putative class action. He sought damages for unpaid wages and penalties (Lab. Code, §§
204, 510, 1194, 1198), failure to pay wages as required upon involuntary separation (Lab.
Code, § 200), failure to pay the meal break penalty at the proper rate (Lab. Code, §§
226.7, 512), failure to provide accurate wage statements (Lab. Code, § 226), and failure
to provide meal breaks and rest breaks (Lab. Code, § 226.7). He also sought restitution
and injunctive relief under the UCL (Bus. & Prof. Code, § 17200 et seq.) for many of the

                                             4
same issues — failure to pay proper wages and overtime compensation, failure to provide
wages at the time of separation, violation of meal period provisions, and failure to
provide itemized wage statements. Finally, under the PAGA (Lab. Code, §§ 2698, 2699),
plaintiffs sought to recover wages and penalties, as applicable, based on largely the same
underlying facts as previously alleged.
              JFK filed a motion to compel arbitration, arguing Woods had agreed to
arbitrate any disputes, the FTP did not expressly permit class arbitration, and the FAA,
which governed the agreement, preempted state laws that might preclude enforcement.
JFK also argued the PAGA claims must be arbitrated.
              In support of its motion, JFK submitted the declaration of Christiane
Korman, a senior human resources generalist for JFK who had held that position since
March 2012. She was familiar with JFK’s procedures for maintaining personnel records.
She authenticated the FTP and the three relevant CBAs, which were attached to her
declaration. She also stated: “I am informed and believe and on that basis state that,
prior to his first day of employment, Mr. Woods was provided with a Tenet Fair
Treatment Process brochure (‘FTP Brochure’). Mr. Woods acknowledged on September
6, 2005, that he received the FTP Brochure, that he reviewed the FTP Brochure, and that
he voluntarily agreed to use the [FTP] and to submit claims and/or disputes to final and
binding arbitration.” Woods’s signed Acknowledgement was attached.
              Korman’s declaration also stated JFK “has treated, and continues to treat,
patients from numerous different states. I am informed and believe, and on that basis
state, that JFK Memorial’s treatment of patients involves the use of medicine, equipment,
and other supplies that are purchased from domestic and overseas manufacturers,
suppliers, and distributors. Moreover, JFK Memorial recruits nurses nationwide,
advertising positions on career recruitment websites.”

                                             5
              Woods opposed. He argued the arbitration agreement was unconscionable
under California law for multiple reasons. He also asserted JFK had failed to provide
declarations or evidence to establish the FAA applied. With respect to the UCL and
PAGA claims, he argued they were simply not arbitrable under California law, and Labor
Code section 229 explicitly permitted actions for wages regardless of an arbitration
agreement.
              In support, Woods attached his own declaration stating that at the time he
began his employment, he attended an orientation with hospital personnel and other new
hires. He was provided with forms to fill out and sign, and was told they were
mandatory. He “did not have the option not to sign the forms presented to me, and it was
my understanding that if I chose not to sign the forms, I would not be hired.” He was
given the employee handbook and Acknowledgment, but was not provided with the time
to read the handbook or the form he was told to sign. “The handbook . . . was very thick
and was close to 100 pages.”
              Further, Woods stated he never received a copy of the FTP brochure. “I
also was not advised by anyone affiliated with Tenet or JFK what the FTP was, what it
meant, or what it otherwise required that I do. To this day, I do not recall ever being
provided with a copy of an FTP brochure.”
              Woods also averred he was not provided a copy with the CBA at the
beginning of his employment, nor was he given a chance to speak to his union
representative to discuss his rights under the CBA. He was also not provided with the
AAA arbitration rules. He stated he did not understand the FTP required him to waive
his rights to pursue claims in court.
              JFK filed a reply disputing Woods’s arguments, and in due course the court
issued a ruling granting JFK’s motion. The court found Woods signed the
Acknowledgment, and the agreement was voluntary because the CBA prohibited JFK

                                             6
from taking adverse action against an employee who did not agree to it. Further, it was
not unconscionable. The court found the agreement was covered by the FAA, and Labor
Code section 229 was accordingly preempted. Nor were his statutory claims excluded
from the agreement. Woods now appeals.
                                               II
                                        DISCUSSION
               The parties disagree on numerous issues, but before we need address the
applicability of the FAA or whether the PAGA claim must be arbitrated, we must
determine whether a valid, enforceable arbitration agreement exists.

A. Standard of Review and General Principles
               We use general principles of California contract law to determine the
enforceability of an arbitration agreement. (Mission Viejo Emergency Medical
Associates v. Beta Healthcare Group (2011) 197 Cal. App. 4th 1146, 1153.) “‘If the
court’s order is based on a decision of fact, then we adopt a substantial evidence standard.
[Citations.] Alternatively, if the court’s denial rests solely on a decision of law, then a de
novo standard of review is employed. [Citations.]’ [Citation.]” (Avery v. Integrated
Healthcare Holdings, Inc. (2013) 218 Cal. App. 4th 50, 60.) When there is no conflicting
evidence regarding the meaning of the agreement, its interpretation is a question of law.
(Ibid.)
               Code of Civil Procedure section 1281.2 requires a court to order arbitration
“if it determines that an agreement to arbitrate . . . exists . . . .” (Code Civ. Proc., §
1281.2.) California has a strong public policy in favor of arbitration as an expeditious
and cost-effective way of resolving disputes. (Moncharsh v. Heily & Blase (1992) 3
Cal. 4th 1, 9.) Even so, parties can only be compelled to arbitrate when they have agreed
to do so. (Westra v. Marcus & Millichap Real Estate Investment Brokerage Co., Inc.

                                                7
(2005) 129 Cal. App. 4th 759, 763.) “Arbitration . . . is a matter of consent, not coercion
. . . .” (Volt Info. Sciences, Inc. v. Bd. of Trustees (1989) 489 U.S. 468, 479.)

B. Unconscionability
              The threshold question is whether any agreement to arbitrate existed.
Woods does not contest this point, but argues instead the agreement was unconscionable.
Civil Code section 1670.5, subdivision (a), codifies unconscionability as a reason for
refusing a contract’s enforcement. It states: “If the court as a matter of law finds the
contract or any clause of the contract to have been unconscionable at the time it was
made the court may refuse to enforce the contract, or it may enforce the remainder of the
contract without the unconscionable clause, or it may so limit the application of any
unconscionable clause as to avoid any unconscionable result.” This provision applies to
arbitration agreements.1 (Armendariz v. Foundation Health Psychcare Services, Inc.
(2000) 24 Cal. 4th 83, 114 (Armendariz), abrogated in part on another ground in AT&T
Mobility LLC v. Concepcion (2011) 563 U.S. __, __ [131 S. Ct. 1740, 1746].)
              “‘[U]nconscionability has both a “procedural” and a “substantive”
element,’ the former focusing on ‘“oppression”’ or ‘“surprise”’ due to unequal bargaining
power, the latter on ‘“overly harsh”’ or ‘“one-sided”’ results. [Citation.] ‘The prevailing
view is that [procedural and substantive unconscionability] must both be present in order
for a court to exercise its discretion to refuse to enforce a contract or clause under the
doctrine of unconscionability.’ [Citation.] But they need not be present in the same
degree. . . . [T]he more substantively oppressive the contract term, the less evidence of
procedural unconscionability is required to come to the conclusion that the term is

1 Further, it applies to arbitration agreements under the FAA as well as under California
law, so we need not decide whether the FAA applies at this juncture. (9 U.S.C. § 2;
Samaniego v. Empire Today, LLC (2012) 205 Cal. App. 4th 1138, 1150.)

                                              8
unenforceable, and vice versa.” (Armendariz, supra, 24 Cal.4th at p. 114.) We discuss
each of these in turn.

              1. Procedural Unconscionability
              “‘“Procedural unconscionability” concerns the manner in which the
contract was negotiated and the circumstances of the parties at that time. [Citation.] It
focuses on factors of oppression and surprise. [Citation.] The oppression component
arises from an inequality of bargaining power of the parties to the contract and an
absence of real negotiation or a meaningful choice on the part of the weaker party.’
[Citation.]” (Morris v. Redwood Empire Bancorp (2005) 128 Cal. App. 4th 1305, 1319
(Morris).)
              We therefore begin our analysis of procedural unconscionability by
determining whether the agreement was a contract of adhesion. (See Parada v. Superior
Court (2009) 176 Cal. App. 4th 1554, 1570.) A contract of adhesion is “‘a standardized
contract, which, imposed and drafted by the party of superior bargaining strength,
relegates to the subscribing party only the opportunity to adhere to the contract or reject
it.’ [Citation.]” (Armendariz, supra, 24 Cal.4th at p. 113.) There was no conflicting
evidence on this point. JFK does not claim Woods had an opportunity to negotiate or
change the terms of the FTP or the Acknowledgment, and there would be no evidence to
support such an argument. Woods’s only choice was to sign or not to sign. Any
agreement to arbitrate was therefore a contract of adhesion.
              That is not the end of our procedural unconscionability analysis, however.
(Morris, supra, 128 Cal.App.4th at p. 1319.) We also consider whether surprise or
oppression are present. (Gutierrez v. Autowest, Inc. (2003) 114 Cal. App. 4th 77, 87
(Gutierrez) [“The procedural element focuses on ‘oppression’ or ‘surprise.’”].)
Oppression here might take the form of Woods being told he was required to sign the

                                              9
Acknowledgment and thereby agree to arbitration, when in fact arbitration was supposed
to be strictly voluntary, and free from retaliation if it was declined, under the CBA.
              JFK argues that at best, the evidence here is conflicting. We disagree. The
language of the Acknowledgment, FTP and CBAs are undisputed. It is undisputed that
for a nurse covered by the CBAs, an arbitration agreement was supposed to be voluntary,
not a condition of employment, and JFK could not retaliate for refusing to agree.
              What is also undisputed is Woods’s testimony regarding how the
Acknowledgment was presented. He swore under oath he was told the forms he had to
fill out and sign were “mandatory” and “it was my understanding that if I chose not to
sign the forms, I would not be hired.” It is undisputed he never received a copy of the
CBA in effect at the time, nor was he told that he was not required to sign the
Acknowledgment. JFK offers no evidence to contradict these facts.
              JFK emphasizes the word “voluntarily” in the Acknowledgement, as if it
were magic, but that word merely begs the question. If a prospective employee is told he
is required to sign something to obtain employment, he might “voluntarily” sign the
document, but there is nothing voluntary about his purported agreement. It becomes a
coercive condition necessary to obtain employment, which was precisely what it was not
supposed to be under the CBA. This constitutes oppression, and a particularly serious
form of oppression at that.
              It is further undisputed Woods did not receive a copy of the arbitration
rules that would govern any proceeding before the AAA, nor do any of the documents
provide information, such as a Web site, indicating where the rules may be readily
obtained. The FTP confusingly states the arbitration shall be conducted under the
“current Employment Dispute Resolution Rules of the AAA,” but also states “discovery
shall be conducted in accordance with the Employee Dispute Resolution Rules of the
AAA.” (Italics added.) It is unclear whether one of these references is a typographical

                                             10
error, but JFK makes no claim and offers no evidence that any set of arbitration rules was
provided to Woods, and the Acknowledgement does not state that Woods received it.
JFK did seek judicial notice of a 2009 document entitled “AAA Employment Arbitration
Rules and Mediation Procedures,” which only confuses matters further, and begs the
question as to the meaning of “current” in the FTP — it is unclear whether “current”
refers to the rules in existence in 2004, or in effect at the time Woods might wish to
arbitrate. This 2009 document obviously did not even exist in 2004. In any event, it is
undisputed Woods received no arbitration rules at all. Both the failure to provide the
arbitration rules and the apparent lack of the existence of any rules under the name to
which the FTP refers each add to the procedural unconscionability. (Zullo v. Superior
Court (2011) 197 Cal. App. 4th 477, 485-486, fn.3.)
               JFK argues that incorporating the rules by reference is sufficient, and any
requirement to actually provide the rules violates the precept that arbitration contracts
cannot create burdens not carried by other contracts. “‘For the terms of another
document to be incorporated into the document executed by the parties the reference
must be clear and unequivocal, the reference must be called to the attention of the other
party and he must consent thereto, and the terms of the incorporated document must be
known or easily available to the contracting parties.’” (Williams Constr. Co. v. Standard-
Pacific Corp. (1967) 254 Cal. App. 2d 442, 454.) Given the two different titles of the
arbitration rules set forth in the FTP, the rules with a third title it later sought judicial
notice of, and the lack of any information about where Woods could obtain the rules, we
conclude JFK did not properly incorporate any arbitration rules by reference.
               Further, when taken as a whole, we find the entire arbitration scheme
unduly confusing, and therefore oppressive, to a layperson. Rather than designing a
single, reasonably short document containing the entire arbitration agreement and nothing
else, and executed like a contract, JFK has chosen to make its procedure needlessly

                                               11
complex. The actual agreement to arbitrate is buried in the fourth paragraph of a
document entitled “Employee Acknowledgment Form.” The details of this are then
toward the end of another document, the FTP. The FTP itself is a complex morass of
complaints and appeals the employee is required to undertake before even being allowed
to arbitrate (we will address the substantive aspect of this below). Nowhere in the
Acknowledgment or the FTP does JFK disclose to CBA-covered employees that
participation in this entire “procedure” is optional, and that refusal will not result in any
retaliation.
               Given this needless complexity, the result is oppression in the form of
uncertainty, confusion, and failure to notify the employee of their rights. As Woods
testified, this is precisely how he reacted: “I also was not advised by anyone affiliated
with Tenet or JFK what the FTP was, what it meant, or what it otherwise required that I
do.” Given both the oppressiveness of the agreement and its adhesive nature, a high level
of procedural unconscionability is present.

               2. Substantive Unconscionability
               While procedural unconscionability focuses on how the agreement was
obtained and executed, “[s]ubstantive unconscionability focuses on whether the provision
is overly harsh or one-sided and is shown if the disputed provision of the contract falls
outside the ‘reasonable expectations’ of the nondrafting party or is ‘unduly oppressive.’
[Citations.]” (Gutierrez, supra, 114 Cal.App.4th at p. 88.) “Substantively
unconscionable terms may take various forms, but may generally be described as unfairly
one-sided.” (Little v. Auto Stiegler, Inc. (2003) 29 Cal. 4th 1064, 1071.) “Where a party
with superior bargaining power has imposed contractual terms on another, courts must
carefully assess claims that one or more of these provisions are one-sided and
unreasonable.” (Gutierrez, supra, 114 Cal.App.4th at p. 88.) “[T]he paramount

                                              12
consideration in assessing [substantive] conscionability is mutuality.” (Abramson v.
Juniper Networks, Inc. (2004) 115 Cal. App. 4th 638, 657 (Abramson).)
              The FTP contains the following provision: “Modifications to the FTP: The
company will not modify or change the agreement between you and the company to use
final and binding arbitration to resolve employment-related disputes without notifying
you and obtaining your consent to such changes. However, the company may change or
modify the FTP procedures from time-to-time without advance notice and without the
consent of employees.” The FTP does not include the actual agreement to arbitrate,
however — this is included in the Acknowledgment: “I hereby voluntarily agree to use
the Company’s Fair Treatment Process and to submit to final and binding arbitration any
and all claims and disputes that are related in any way to my employment or the
termination of my employment with Tenet.” The Acknowledgment also states: “I also
understand that the company may change, rescind or add to any of the policies, benefits
or practices described in the Employee Handbook, except . . . the Mutual Agreement to
Arbitrate referred to below, in its sole and absolute discretion, with or without prior
notice.”
              This provision is troubling in a number of respects. JFK claims these
provisions prohibit any modification to actual arbitration procedures, as well as the actual
agreement to arbitrate. Taken together, these provisions are at best confusing and
potentially conflicting. The FTP’s language stating JFK “will not modify or change the
agreement between you and the company to use final and binding arbitration” (italics
added) is not wholly consistent with the Acknowledgment’s language that JFK can
“change, rescind or add to” anything except the agreement to arbitrate. The FTP’s
language implies only that JFK cannot change the agreement to use arbitration, while the
Acknowledgment may imply something more. At a minimum, it is confusing, and
appears to leave the door open for JFK to make changes without employee agreement.

                                             13
              Even if we adopt JFK’s position on that it cannot unilaterally modify
anything to do with actual arbitration procedures, JFK has unquestionably reserved the
right to change the pre-arbitration procedures in the FTP. Already burdensome to the
employee at four steps, there is nothing to stop JFK from unilaterally expanding these
procedures to add yet more burdens to employees before they are even permitted to begin
arbitration. Given these procedures are mandatory in most cases, we see little difference
between changing the arbitration and pre-arbitration procedures in this particular case.
JFK, by giving itself the permission to make such changes unilaterally, and without any
notice, has created an unfairly one-sided agreement. (Little v. Auto Stiegler, Inc., supra,
29 Cal.4th at p. 1071; Abramson, supra, 115 Cal.App.4th at p. 657.)
              Woods also argues the FTP lacks mutuality because the pre-arbitration
proceedings must only be undertaken by employees and not JFK. The language of the
FTP supports this claim: “The FTP consists of the following five steps that employees
generally must follow to obtain a resolution of a problem, concern, or dispute . . . .”
(Italics added.) The steps include multiple references to “you,” meaning the employee.
There is no indication JFK must also use the FTP procedure to resolve a problem with an
employee. The forms provided to employees to use in accordance with the FTP include
language such as “STEP 1 – Grievance (to be submitted to Immediate Supervisor): [¶] 1.
Please describe below with as much detail as possible the dispute or problem that you
would like your supervisor to help you resolve . . . .” Nothing in any of the language
indicates mutuality.
              Again, this indicates a one-sided process that also gives JFK the benefit of a
pre-arbitration preview of Woods’s case. “[R]equiring plaintiff to submit to an
employer-controlled dispute resolution mechanism (i.e., one without a neutral mediator)
suggests that defendant would receive a ‘free peek’ at plaintiff’s case, thereby obtaining
an advantage if and when plaintiff were to later demand arbitration.” (Nyulassy v.

                                             14
Lockheed Martin Corp. (2004) 120 Cal. App. 4th 1267, 1283.) This is another unfairly
one-sided provision indicating substantive unconscionability. “[T]he paramount
consideration in assessing [substantive] conscionability is mutuality.” (Abramson, supra,
(2004) 115 Cal.App.4th at p. 657), and this agreement has failed that test in several
important respects. Taken together with the substantial level of procedural
unconscionability, the agreement is sufficiently substantively unconscionable to preclude
its enforcement.
              We are, frankly, perplexed that we continue to see arbitration agreements
such as this one. The years since Armendariz have produced a veritable flood of cases
about arbitration between employers and employees. Employers should be well aware by
now that to insulate their agreements from unconscionability claims, particularly when
they are adhesive contracts, there is a simple list of do’s and don’ts. The arbitration
agreement should be conspicuous (and preferably labeled as such, in a document separate
from a lengthy handbook). The document should be written in plain English, attach or
make readily available all referenced documents, be fundamentally fair and mutual, and
in all respects abide by the guidance provided in Armendariz. Further, employers should
give the employee a meaningful opportunity to review the agreement and decide whether
to sign it (meaning a day or two rather than a minute or two). We do not understand why
any of this is particularly difficult or challenging for employers, and yet time and time
again, our courts see cases with confusing, convoluted and fundamentally unfair
employer/employee arbitration schemes that are deemed unconscionable and
unenforceable. (See, e.g., Carmona v. Lincoln Millennium Car Wash, Inc. (2014) 226
Cal. App. 4th 74; Samaniego v. Empire Today, LLC, supra, 205 Cal. App. 4th 1138
[contract workers]; Zullo v. Superior Court, supra, 197 Cal. App. 4th 477; Trivedi v.
Curexo Technology Corp. (2010) 189 Cal. App. 4th 387; Nyulassy v. Lockheed Martin

                                             15
Corp, supra, 120 Cal. App. 4th 1267; Fitz v. NCR Corp. (2004) 118 Cal. App. 4th 702;
Abramson, supra, 115 Cal. App. 4th 638; Gutierrez, supra, 114 Cal. App. 4th 77.)
              This is one such agreement. Taken as a whole, we find the agreement both
procedurally and substantively unconscionable and therefore unenforceable. The parties’
remaining arguments are moot, and JFK’s request for judicial notice is denied as
irrelevant.
                                           III
                                     DISPOSITION
              The court’s order is reversed and the case remanded for further
proceedings. Woods is entitled to his costs on appeal.

                                                 MOORE, J.

WE CONCUR:

RYLAARSDAM, ACTING P. J.

THOMPSON, J.

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