Balandran v. Labor Ready, Inc

In Balandran v. Labor Ready, Inc. (2004) 124 Cal.App.4th 1522, the plaintiffs signed an employment application with a company, agreeing to arbitrate "any dispute arising out of my employment, including any claims of discrimination, harassment or wrongful termination that I believe I have against the employer and all other employment related issues . . . ." (Id. at p. 1528.) The plaintiffs brought a lawsuit against the company alleging the company discriminated against them by failing to hire them. (Id. at p. 1526.) The company sought to enforce the arbitration clause, but the reviewing court found the plaintiffs' claims were beyond the scope of the agreement because the plaintiffs were never employed by the company. (Id. at pp. 1528-1530.) The Balandran court stated that the company "conceded that plaintiffs were not its employees and therefore the company did not attempt to argue that plaintiffs' preemployment discrimination claims 'arise out of their employment.' The company instead argued plaintiffs' claims fall within that part of the arbitration clause that applies to 'all other employment related issues.' " (Id. at p. 1526.) The Balandran court rejected the latter argument, explaining that " 'all other employment related issues' " was not a separate category of claims, but instead was part of the " 'including' " clause that defined " 'disputes arising out of . . . employment.' " (Id. at pp. 1529-1530.) The language of the arbitration provision in this case is materially different from the Balandran agreement. The arbitration provision here specifically applied to claims arising out of Budman's employment relationship with IPI, which was defined to include the Agreement. In Balandran, the "including" clause referred to the types of employment claims that were covered by the agreement, e.g., discrimination and/or harassment claims. (Balandran, supra, 124 Cal.App.4th at p. 1525.) In Balandran v. Labor Ready, Inc. (2004) the court affirmed the trial court's refusal to compel arbitration under a restrictively worded arbitration provision in a job application for a temporary labor service. While the arbitration clause applied to any dispute arising out of the applicants' employment, the agreement provided that applicants were not to be considered employed until they were assigned to work on a job. Balandran found that this definition limited the scope of the arbitration clause, and did not preclude the applicants from litigating preemployment discrimination claims when the service illegally agreed to send only male workers to a customer's jobsite. "This arbitration clause plainly applies only to those employment related issues which arise out of employment. As plaintiffs were never employed, the arbitration clause does not apply." (Id. at p. 1530.)