Plaintiffs are a class of employees working for an armored car company and alleged that they were denied meal and rest breaks as required by the ?Washington ?Industrial ?Welfare ?Act, ?RCW 49.12, and the Minimum Wage Act, RCW 49.46. All employees are members of employee associations which are not labor unions in the traditional sense at least in part because they do not collect dues and have no resources.?? Although all employees are required to agree to a ?labor agreement,? little or no bargaining actually exists. The ?labor agreement? contained a mandatory arbitration provision.

The employees filed a motion for class certification.? ?Garda filed its opposition to the motion for class certification, and on the same date it also filed a motion to compel arbitration or for summary judgment.?? The class was certified and notice to members was sent.?? Thereafter, Garda?s motion for summary judgment was denied, but the Court granted the motion to compel arbitration for the class that had already been certified.?? Garda appealed ?the? decision ?to ?allow ?class ?arbitration, and the employees cross appealed the order to compel? ?arbitration? ?on? ?a? ?variety?? of? ?grounds including that the arbitration provision was unconscionable. The Court of Appeals affirmed the order to compel arbitration but reversed the trial court on the issue of class arbitration, holding that the arbitration must proceed on an individual basis. The court of appeals did not reach the employees’ claim ?that ?the? arbitration ?clause? is unconscionable. ?The Washington State Supreme Court unanimously reversed the decision of the Court of Appeals.

The Supreme Court found that the provisions of the ?labor agreement? which required arbitration were unconscionable.?? The Court? ?ruled? ?that? ??[u]nconscionability? ?is? ?a ?gateway?? dispute?? ?that? ?courts? ?must? ?resolve because a party cannot be required to fulfill a bargain that should be voided.? ?The Court also ruled that the issue of whether or not to compel arbitration is immediately reviewable. Justice Stephens reiterated its familiar jurisprudence that a term is substantively unconscionable where it is overly or monstrously harsh, is one-sided, shocks the conscience, or is exceedingly ?calloused.?? ?The ?Court ?may? have made new law in holding that either substantive or ?procedural ?unconscionability? is ?enough ?to void a contract under Washington law.

The? Court ?ruled ?that ?the? labor agreement?s 14 day statute of limitations period was ?substantively? unconscionable.?? ?The ?Court also ruled that a limit to the recovery of wages to two and/or four months was unconscionable because ?it is one-sided in that it unfairly favors Garda by significantly curbing what an employee could recover against Garda compared to what the employee could recover under a statutory wage and hour claim.? ?The labor agreement also provided ?that ??[t]he? Union ?and ?the? Company shall each pay one-half (?) of the fee charged by the arbitrator, the cost of the hearing room, the reporter’s fee, per diem, and the original copy of the? transcript ?for ?the? arbitrator.??? ?The? Court found? ?this? ?provision?? to? ?be? ?unconscionable because the employees presented evidence about the ?anticipated ?costs ?and ?that ?such ?fees ?would prohibit it from bringing their claims.

The Court found that severing the unconscionable provisions would ?significantly alter[s] both the tone of the arbitration clause and the nature of the arbitration contemplated by the clause,? and that they pervade the labor agreement. The Court therefore found the ?labor agreement? unconscionable and unenforceable in its entirety.

The Court didn?t reach the issue of class wide arbitration or waiver. making process asserting that age played no part in the decision making process.? ?Rather the College explained that it relied upon the ?broader institutional picture, what was lacking in terms of skills ?and ?abilities ?within ?the? English Department, and considered which candidates would contribute to student success and the institution as a whole.??? The plaintiff presented the evidence of comments made by the President of the College, statistical evidence, and the fact that those hired were substantially younger with less experience. ?Summary judgment was granted and plaintiff appealed.? ?The Court? of Appeals affirmed.

Hill ?v. ?Garda,? ???? ?(9/12/2013) Wn.2d?? ??????, ?308 ?P.3d ?635