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Arbitration covers claims for unpaid bonus and severance

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in Compensation and Benefits,Employment Law,Firing,Human Resources,Leaders & Managers,Management Training

In an opinion welcomed by multistate employers with employees and operations in California, the California Court of Appeal recently ruled that binding arbitration mandated by an arbitration agreement could determine a former employee’s wage claims for an unpaid profit-sharing bonus and severance pay.

The Court of Appeal held that Section 2 of the Federal Arbitration Act (FAA) pre-empts an employee’s right
to a judicial forum for the employee’s unpaid wage claims under California Labor Code Section 229. The FAA mandates enforcement of arbitration clauses in contracts involving interstate commerce. The case is Giuliano v. Inland Empire Personnel, Inc., No. B190771, California Court of Appeal, 2nd Appellate District, 2007.

The case

In 2003, James Giuliano moved from Indiana to California to become executive vice president and chief financial officer of Inland Empire Personnel. Giuliano signed an employment contract contain...(register to read more)

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