On April 6, 2017, in the matter Sharon McGill v. Citibank, N.A., the California Supreme Court ruled unanimously that an arbitration agreement that waives a statutory right to seek public injunctive relief in any forum, is contrary to California public policy and is therefore unenforceable under California law.  In arriving at its ruling, the Court distinguished between class action waivers and the waiver of the right to public injunctive relief.  The Court held that class actions are a procedural device that enforces substantive law, while the right to public injunctive relief is an unwaivable substantive statutory remedy that the Legislature has expressly made available under certain laws.  Although this is not an employment case, the Court’s holding is important in the employment context because it distinguishes between the waiver at issue in the agreement, which it ruled was unenforceable, and class action waivers, which many employers include in their mandatory arbitration agreements.
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