Contreras v. Super. Ct., 61 Cal.App.5th 461

Background

Plaintiffs Robina Contreras and Gabriel Ets‑Hokin worked as drivers for Zum and signed Zum’s Terms of Service arbitration agreement (JAMS rules incorporated; class/representative actions waived).
Plaintiffs sued under the Private Attorneys General Act (PAGA), alleging misclassification as independent contractors and multiple Labor Code violations.
Zum moved to compel arbitration and argued the agreement (and incorporated JAMS rules) delegated gateway arbitrability questions—including whether plaintiffs are “aggrieved employees”—to an arbitrator.
The trial court granted Zum’s motion and ordered the antecedent question of arbitrability (employee v. independent contractor) sent to arbitration.
Plaintiffs petitioned for writ relief. The Court of Appeal reviewed de novo and held that sending the employee‑status gateway question to private arbitration would effectively force arbitration of a PAGA representative claim without the state’s consent.
The court issued a peremptory writ vacating the trial court’s order and directing denial of Zum’s motion to compel arbitration.

Issues

Issue	Plaintiff's Argument	Defendant's Argument	Held
Are PAGA claims waivable/arbitrable under the FAA?	PAGA claims are nonwaivable and not arbitrable because they are suits on behalf of the state.	FAA and Supreme Court arbitration precedents preempt state law limits on arbitration.	PAGA claims lie outside the FAA’s coverage; Iskanian controls—PAGA is a representative action for the state and not subject to predispute waiver/arbitration without state consent.
May an employer compel arbitration of a PAGA claim via an employee’s predispute arbitration agreement?	No—an employee cannot be forced to arbitrate a representative PAGA action because the state is the real party in interest and did not consent.	Yes—the arbitration agreement covers disputes and courts should enforce its terms.	No—an employer may not compel arbitration of a PAGA representative claim absent the state’s consent.
Can parties delegate gateway arbitrability questions (e.g., whether plaintiff is an "aggrieved employee") to an arbitrator?	Delegating such antecedent questions would split and effectively extinguish the state’s representative claim without consent; courts must decide.	Delegation clauses (plus JAMS rule incorporation) clearly and unmistakably assign arbitrability and gateway questions to an arbitrator.	Court cannot allow private arbitration to decide whether a plaintiff is an "aggrieved employee" where that decision would nullify a PAGA action the state owns; splitting the PAGA claim is prohibited.
Was the trial court’s order compelling arbitration of the employee‑status gateway question correct?	Trial court erred because it permitted arbitration to resolve an essential element of a representative PAGA claim.	The order only sent a preliminary gateway issue to arbitration per the parties’ agreement.	Reversed—the trial court’s order compelling arbitration of the gateway employee‑status issue was vacated and the motion to compel arbitration must be denied.

Key Cases Cited

Iskanian v. CLS Transp. Los Angeles, LLC, 59 Cal.4th 348 (2014) (PAGA claims are representative actions for the state and not waivable/arbitrable by employee predispute agreements)
Arias v. Superior Court, 46 Cal.4th 969 (2009) (legislative purpose and structure of PAGA; employees act as private attorneys general)
AT&T Mobility LLC v. Concepcion, 563 U.S. 333 (2011) (FAA can preempt state rules invalidating arbitration agreements for class actions)
Epic Sys. Corp. v. Lewis, 138 S. Ct. 1612 (2018) (FAA enforces arbitration agreements even where they displace collective proceedings under federal statutes)
Rent‑A‑Center, W., Inc. v. Jackson, 561 U.S. 63 (2010) (parties may delegate arbitrability to arbitrator if delegation clause is clear and unmistakable)
Correia v. NB Baker Electric, Inc., 32 Cal.App.5th 602 (2019) (without state consent, predispute arbitration agreements cannot compel arbitration of PAGA representative claims)
Provost v. YourMechanic, Inc., 55 Cal.App.5th 982 (2020) (employer may not split a PAGA action by forcing arbitration of whether plaintiff is an "aggrieved employee")
Williams v. Superior Court, 237 Cal.App.4th 642 (2015) (a single representative PAGA action cannot be split into arbitrable individual and nonarbitrable representative components)
Perez v. U‑Haul Co. of California, 3 Cal.App.5th 408 (2016) (court rejected compelling individual arbitration of aggrieved‑employee standing before litigating representative PAGA claims)
ZB, N.A. v. Superior Court, 8 Cal.5th 175 (2019) (cited Iskanian approvingly on nonwaivability of PAGA representative claims)