38 Cal. App. 5th 723
Cal. Ct. App. 5th2019Background
- Plaintiff Loren Mejia sued defendants Merchants Building Maintenance (MBM) under PAGA alleging multiple Labor Code violations (meal/rest breaks, unpaid wages, wage statements, final wages).
- Mejia’s union CBA required individual arbitration for wage-and-hour disputes and invoked an FAA-governed arbitration protocol.
- MBM moved to compel arbitration of the portion of Mejia’s PAGA claim seeking “an amount sufficient to recover underpaid wages” under Lab. Code § 558, arguing that amount is victim-specific individual relief and thus arbitrable.
- The trial court denied MBM’s motion to compel arbitration; MBM appealed.
- The court considered whether a single PAGA claim seeking § 558 penalties can be split so that the underpaid-wages component is sent to arbitration while the $50/$100 per-violation component remains in court.
- The court affirmed the denial: a PAGA claim for § 558 penalties is indivisible and may not be split between arbitration and litigation; the entire representative PAGA claim remains non-arbitrable.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether a PAGA claim for penalties under Lab. Code § 558 can be split so the portion equal to underpaid wages is sent to arbitration while the $50/$100 penalty remains in court | Mejia: § 558 penalties are a single civil penalty recoverable in a PAGA action; she brought a representative action so the claim is non-arbitrable | MBM: The underpaid-wages component is victim-specific individual relief and thus arbitrable under the CBA/Federal Arbitration Act | The court held the PAGA § 558 penalty is a single representative claim; it cannot be split and compelled to arbitration; denial of motion to compel affirmed |
Key Cases Cited
- Iskanian v. CLS Transp. Los Angeles, LLC, 59 Cal.4th 348 (PAGA claims cannot be waived or compelled into arbitration as to the representative public-enforcement aspect)
- Arias v. Superior Court, 46 Cal.4th 969 (PAGA deputizes aggrieved employees as private attorneys general to recover civil penalties)
- Thurman v. Bayshore Transit Mgmt., Inc., 203 Cal.App.4th 1112 (§ 558’s civil penalty comprises both the $50/$100 assessment and amount sufficient to recover underpaid wages)
- Lawson v. ZB, N.A., 18 Cal.App.5th 705 (court held a PAGA § 558 claim may not be split to send underpaid-wages portion to arbitration)
- Zakaryan v. The Men's Wearhouse, Inc., 33 Cal.App.5th 659 (same conclusion: PAGA plaintiff acts for the state and cannot split § 558 claim into arbitrable individual piece)
- Broughton v. Cigna Healthplans, 21 Cal.4th 1066 (permitted splitting CLRA claims between arbitration and court when distinct primary rights exist)
- Cruz v. PacifiCare Health Sys., Inc., 30 Cal.4th 303 (allowed splitting UCL claims between arbitration and court where remedies and rights differ)
- Boeken v. Philip Morris USA, Inc., 48 Cal.4th 788 (primary-rights doctrine: one injury gives rise to one claim for relief)