Parties May Agree That an Arbitrator, Not a Judge, Will Decide if Their Dispute is Arbitrable

Parties May Agree That an Arbitrator, Not a Judge, Will Decide if Their Dispute is Arbitrable

On January 8, 2019, a unanimous United States Supreme Court held in Schein v. Archer & White Sales that the parties to an arbitration agreement may agree to have an arbitrator decide “gateway questions of arbitrability,” as well as the merits of a particular dispute. The high court’s decision in Schein follows another recent pro-arbitration decision handed down on May 21, 2018 in Epic Systems Corp. v. Lewis where it held that the parties may agree that an employee will arbitrate employment-related claims he or she may have against his or her employer only on an individual basis in arbitration, effectively waiving his or her right to bring a class or collective action. California employers that use arbitration agreements will find support in the recent holdings of the U.S. Supreme Court, but they must also ensure that their agreements include the “safeguards” required in California before a State court judge will order an employment-related dispute to a private arbitrator, and they must understand that certain claims, such as PAGA, will not be ordered to arbitration.