In a long-awaited decision, the California Supreme Court recently issued a decision in the Adolph v. Uber Technologies case, ruling that individuals who bring claims under the Labor Code Private Attorneys General Act (PAGA) composed of individual and non-individual claims can arbitrate their individual claims if compelled to do so, but still have standing to litigate non-individual claims on behalf of other employees in court.

Background and the New Precedent

It had long been the rule in California that a PAGA claim could be split into individual and non-individual components. In June 2022, the U.S. Supreme Court in Viking River v. Moriana mostly rejected California’s position on PAGA claims and held that the Federal Arbitration Act preempted California’s rule preventing courts from dividing PAGA claims into their individual and non-individual component parts. The Supreme Court held that the PAGA claims could be split, and an employee’s individual PAGA claims could be compelled to arbitration under an enforceable agreement. Without the individual claims, a PAGA plaintiff would lack standing to pursue non-individual claims, and those claims should therefore be dismissed.

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