Habla Espanol? Another Wrinkle in Arbitration Agreements

On April 21, 2014, the appellate court issued their opinion in Carmona v. Lincoln Millenium Car Cash (4/21/14), 2014 S.O.S. 2369. The plaintiffs were former employees who filed a Class Action for wage and hour violations. All employees had signed an employment agreement containing a binding arbitration agreement, and a confidentiality clause. The arbitration clause and confidentiality clause were translated into Spanish, but other portions of the contract were in English, as were other documents the employees were required to sign including a confidentiality agreement.
Upon filing the lawsuit, Defendants filed a Motion to Compel Arbitration. In opposition, two of the named plaintiffs submitted declarations stating that they could not read or write English, read very little Spanish, and did not understand the contracts that they were signing, but thought it was only a required employment application that they could not negotiate. They further declared that they did not understand what arbitration meant or that they were waiving their rights to appear in court.
The trial court denied the motion, finding the agreement was procedurally unconscionable because it was presented to employees as a “take it or leave it” application, the employer did not provide copies of the rules of arbitration, and gave insufficient time to review the agreement. Finally, the court ruled that because only portions of the agreement were in Spanish, and key provisions were never translated the agreement was unenforceable. The appellate court affirmed the ruling, noting that what produced the “high degree” of unconscionability in this case was the fact that key provisions in the agreement, including the clause regarding the enforceability, and confidentiality sub-agreement were not translated into Spanish. The court explained that because some portions were translated it was clear that Defendants knew the plaintiffs could not read or write English, but chose not to translate the entire agreement.
While courts have previously found both procedural and substantive unconscionability for many of the issued raised in this opinion, it is notable because the court specifically addressed the failure to translate portions of the hiring documents into Spanish as a ground for refusing to consider enforcing the arbitration agreement. Employers who hire non-English speaking employees should consider updating their employment applications, as well as any other agreements that they have employees sign translated into the employee’s native language.

Emilio Law Group - Corporate Defense, Employment Litigation

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