In April 2011, the U.S. Supreme Court issued its landmark decision in AT&T Mobility v. Concepcion, 11 C.D.O.S. 4842, holding that the Federal Arbitration Act pre-empts California’s Discover Bank rule. In many cases, that rule invalidated arbitration agreements in which parties waived the right to classwide proceedings. While Concepcion arose in the consumer context, it has potentially far-reaching implications in the employment context. Indeed, Concepcion has been looked on favorably by many employers as wholeheartedly approving class action waivers and signaling the death knell of expensive and time-consuming class actions. As courts wrestle with the application of Concepcion to employment cases, with often confusing results, it behooves employers to proceed cautiously in revising their arbitration agreements.

In California, courts are grappling with a number of issues following Concepcion. One issue, for example, is the impact of Concepcion on the California Supreme Court’s decision in Gentry v. Superior Court, 42 Cal.4th 443 (2007). Gentry held that class action waivers in employment agreements could be unenforceable where a plaintiff establishes certain factors that, taken together, show the waiver would undermine the vindication of a substantive statutory right. California state and federal courts are split on the continued viability of Gentry following Concepcion. Compare, Brown v. Ralph’s Grocery, 197 Cal.App.4th 489 (2011) (declining to decide whether Gentry is still good law following Concepcion) and Plows v. Rockwell Collins, 812 F.Supp.2d 1063, 1069-70 (C.D. Cal. 2011) (holding that Gentry is still good law), with Lewis v. UBS Fin. Services, 818 F.Supp.2d 1161 (N.D. Cal. 2011) (stating that Gentry is no longer good law).

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