The U.S. Supreme Court has granted certiorari in Viking River Cruises, Inc., v. Moriana, which seeks to determine the implications of its 2018 case involving electronic health record system Epic.
In that case, Epic Systems v. Lewis, the U.S. Supreme Court found that employers can implement arbitration agreements with class-action waivers.
But the new case will determine whether that decision extends to waivers of claims brought under the California Private Attorneys General Act.
WHY IT MATTERS
As employer lawyers from Epstein Becker & Green noted in a blog post, the decision in Viking River may extend beyond California, just as the one in Epic Systems did.
But given the tech giants with operations in California – including Google and Apple – even a decision that only impacted the state would have repercussions for workers in the health IT industry. Indeed, a group of Google employees brought suit against the company under PAGA in 2016.
At issue in the case is California’s law allowing a single employee to file suit on behalf of all aggrieved workers for violations of the state’s Labor Code. The law allows them to do so, the attorneys said, without having to undergo the procedural requirements for a class action.
The Court’s decision in Epic Systems upheld the use of class action waivers in arbitration agreements, which essentially required labor and wage disputes to be fought out individually rather than as part of class-action battles.
According to Epstein Becker & Green, employers in California have more frequently used arbitration agreements that include class action and PAGA representative action waivers.
But in 2014, the California Supreme Court said the latter type is not enforceable; it reaffirmed this again in 2020.
This past week, the Supreme Court said it would review the PAGA waiver case.
Despite the potential consequences of this case, “the ultimate impact of this case will depend, however, on the outcome of yet another California arbitration dispute,” noted labor attorneys Payne & Fears lawyers in a blog post about the case.
“As a reminder, the challenge to AB 51, California’s ban on mandatory employment arbitration agreements, remains active in the federal courts. A petition for rehearing of the Ninth Circuit’s decision in Chamber of Commerce v. Bonta, 13 F.4th 766 (2021), is pending.
“Should that petition fail, a request for review by the U.S. Supreme Court is likely,” they continued.
THE LARGER TREND
As with any other industry, the health IT sector has faced its share of labor disputes.
The year prior, Kaiser Permanente IT workers staged a protest about the company’s alleged refusal to negotiate a contract, which employees said put patient privacy at risk.
ON THE RECORD
“Should the Court rule in favor of the employer, this case has the potential to alter dramatically the wage-and-hour landscape in California by giving employers a powerful mechanism for minimizing, if not eliminating, PAGA claims,” said Payne & Fears attorneys in their blog post.