October 24, 2020

Volume X, Number 298

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Governor Signs Legislation Expanding Labor Commissioner Representation to Arbitrations

On September 28, 2020, Governor Newsom signed Senate Bill 1384, which (1) expands the California Labor Commissioner’s representation to arbitrations for claimants who cannot afford counsel, (2) requires employers to serve petitions to compel arbitration on the Labor Commissioner, and (3) allows the Labor Commissioner to represent claimants in proceedings to determine whether arbitration agreements are enforceable.

SB 1384 modifies Labor Code section 98.4, which previously provided only that the Labor Commissioner could represent indigent claimants in de novo proceedings (appeals of Labor Commissioner wage claim awards).  SB 1384 keeps Section 98.4’s original language but adds two new subparts, which provide at (b) and (c), respectively:

  • Where a claimant cannot have their wage claim adjudicated by the Labor Commissioner under Sections 98 and 98.1 due to a court order compelling arbitration, at the claimant’s request, the Labor Commissioner must represent the claimant in the arbitral proceeding if (1) the claimant is financially unable to afford counsel, and (2) the Labor Commissioner determines, upon conclusion of an informal investigation, that the claim has merit; and

  • Petitions to compel arbitration of Section 98, 98.1, or 98.2 claims must be served on the Labor Commissioner and, upon request, the Labor Commissioner may represent claimants in proceedings to determine the enforceability of the arbitration agreement (regardless of whether arbitrability is determined by a judge or an arbitrator).

Going forward, employers will need to be sure to serve petitions to compel arbitration of Section 98, 98.1, and 98.2 wage claims on the Labor Commissioner and can expect to see an increase in challenges to the arbitration of such claims, as well as increased legal representation in the arbitration of such claims.

The subpart (b) provision regarding the Labor Commissioner’s informal investigation to determine the claim’s merits is a new provision for which there is presently no specific precedent or guidance.  Jackson Lewis will track how this investigation provision is applied and will continue tracking state legislation that is relevant to employers.

Jackson Lewis P.C. © 2020National Law Review, Volume X, Number 273
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About this Author

Adam Siegel, Employment Attorney, Whistleblower claims, Jackson Lewis Law FIrm
Principal

Adam Y. Siegel is a Shareholder in the Los Angeles, California office of Jackson Lewis P.C.

Mr. Siegel focuses mainly in employment litigation and represents both private and public sector employers in all aspects of employment law, specializing in litigation and trial of harassment, discrimination, breach of contract, wage/hour, due process, and other employment related claims and has litigated cases in both state and federal court.  As part of his extensive public sector experience, Mr. Siegel has conducted and prepared Investigation Reports pursuant to the California Government...

213-630-8241
Zoe Yuzna, Jackson Lewis Law Firm, Los Angeles, Labor and Employment Litigation Attorney
Associate

Zoe Yuzna is an Associate in the Los Angeles, California, office of Jackson Lewis P.C. She represents employers in all types of employment litigation including wage and hour, harassment, discrimination, retaliation, and wrongful termination matters. She also advises and counsels employers with respect to a diverse range of legal issues.

Ms. Yuzna joined Jackson Lewis from the Division of Labor Standards Enforcement (DLSE) where she represented and advised the California Labor Commissioner and her staff on all aspects of enforcement and interpretation of California's labor laws and licensing requirements. She also handled matters involving meal and rest period compliance and enforcement, public works and prevailing wage requirements, and the Talent Agency Act.  In her time with the DLSE, Ms. Yuzna enjoyed a 100 percent success rate in court on all motions, trials, and writs.

213-630-8292
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