Most Of Arbitration And Fees Were Sustained Except For A Remand To Arbitrator On Unwaivable Nonallowance Of Wage/Hour Fees To Employer Unless Employee’s Claims Brought In Bad Faith.
In Dorne v. Vascular and Interventional Specialists, Case No. G054213 (4th Dist., Dist. 3 Aug. 27, 2018, received for posting Aug. 28, 2018, unpublished), a medical doctor former employee brought both contractual and Labor Code wage/hour claims against his former employer medical group. The matter went to arbitration, with doctor losing all of his claims and with the arbitrator awarding $366,098 in attorney’s fees and costs pursuant to a contractual fees clause and the superior court awarding another $30,000 in post-arbitration fees to medical group for prevailing after the lower court confirmed the award/refused to vacate it.
Former employee prevailed, getting some limited relief—but subject to the arbitrator making a narrower determination of what fees might not be allowable on remand.
Most of the arbitrator’s determinations got affirmed under the Moncharsh deferential standard for reviewing arbitration decisions given the arbitrator was largely interpreting the employment agreement between the two sides. However, a limited remand was in order to determine if the arbitrator awarded fees against employee which fell within the ambit of Labor Code section 218.5(a), a public policy provision specifying that employees are not liable for fees for unsuccessful wage/hour claims unless they were brought in bad faith. The appellate court, in a 3-0 decision authored by Acting Presiding Justice Bedsworth, decided that this provision was an unwaivable public policy statute which could not be ignored in arbitration. The proper remedy, in this situation, was to resubmit the matter to the arbitrator to see if fees were excludable on this basis. Otherwise, the arbitration expenses and superior court post-arbitration fees were properly awarded to former employer medical group. (See Ling v. P.F. Chang’s China Bistro, Inc., 245 Cal.App.4th 1242, 1263 (2016) [statutory Labor Code fee provisions do not extend to post-arbitration activities before superior court].)