The California Court of Appeals in Diaz v. Sohnen Enterprises, Inc. overturned a district court decision
denying a motion to compel arbitration agreement.
Sohnen Enterprises held a meeting at which it informed
employees that it was introducing a new arbitration agreement. Sohnen told
employees that if they chose not to sign the new agreement but continued to
work then that would mean they accepted the arbitration agreement. Erika Diaz
refused to sign the arbitration agreement but continued to work for Sohnen from
December 2 to 23. She then had her lawyer send her employer a letter saying
that she planned to keep working but did not accept the arbitration agreement.
After bringing a workplace discrimination case, Diaz challenged the employer’s motion
to compel arguing that she never assented to the new agreement. The court of
appeals, over a dissent, disagreed saying that her decision to continue work
was an implied assent to the agreement. By the time her lawyer sent a letter
Diaz was already bound.
