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A California appellate court determined that an employment application that disclaimed the formation of an employment contract was not sufficient to establish the existence of an arbitration agreement between the employer and employee. The Court thus denied the employer’s motion to compel arbitration.
In Lyng v. Brendan Vacations, Inc., No. B207245, 2008 WL 4516220 ( Cal. Ct. App. Oct. 9, 2008), Lyng sued Brendan Vacations for wrongful termination and violations of the Fair Employment and Housing Act after she requested time off to undergo chemotherapy for breast cancer.
In response, Brendan Vacations filed a motion to compel arbitration based on Lyng’s employment application. As part of the employment process, Lyng initialed an arbitration agreement on her employment application. Lyng argued that Brendan Vacations was seeking to enforce an employment application, which by its express terms was not a binding contract and thus not a valid arbitration agreement.
The trial court agreed with Lyng and denied Brendan Vacations’s motion. On appeal, the Court applied California contract law in determining whether the parties had formed a valid agreement to arbitrate. The Court noted that a party seeking to compel arbitration has the burden of proving the existence of a valid agreement to arbitrate. In this case, the Court determined that Brendan Vacations failed to meet its burden of proof. The only evidence submitted by Brendan Vacations was the employment application.
The express terms of the employment application stated that the application did not create an employment contract between Lyng and Brendan Vacations. There was no evidence as to the nature and circumstances of Brendan Vacations’s acceptance of the employment application. Further, there was no other evidence that the parties entered into a written agreement to arbitrate.
The Court noted that an arbitration clause in an employment application may be enforceable. However, according to the Court, where there is no evidence that the employer accepted the terms of the written employment application, there is no way to determine whether a valid agreement to arbitrate exists. The Court thus affirmed the order denying Brendan Vacations’ motion to compel arbitration.
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