ACEVEDO v. ABM INDUSTRY GROUPS LLC (2025)

ORDER GRANTING MOTION TO COMPEL ARBITRATION

Re: Dkt. No. 10

Plaintiff Maria de Los Angeles Acevedo worked as a day porter for defendant ABM Industry Groups, LLC. As a unionized employee, Acevedo was subject to her union's collective bargaining agreement with ABM, which mandates arbitration of all claims alleging violations of the California Labor Code's requirements regarding wages and hours, meals, and rest periods. Acevedo filed this putative class action against ABM in state court alleging such violations. ABM removed the case to federal court and now moves to dismiss the complaint for failure to state a claim or, in the alternative, to strike Acevedo's class claims and compel arbitration of her remaining claims. For the following reasons, the Court orders Acevedo to arbitrate all of her claims against ABM in accordance with the applicable terms of the CBA.

BACKGROUND

Acevedo worked for ABM as a day porter providing cleaning services to defendant Fortinet, Inc. Before she began her employment, ABM required her to complete several onboarding documents, including a Mutual Arbitration Agreement (MAA). As a unionized employee, Acevedo was represented by the Service Employees International Union, United Service Workers-West, and her employment was governed by the union's CBA with ABM. The CBA included a “Wage and Hour Protocol” providing:

The Parties to this Agreement believe that it is in the best interests of all involved – employees/members, employer, the Union, and the public interest – to promptly, fairly and efficiently resolve through mediation and arbitration all claims alleging violations of wage and hour and/or meal and rest period laws, including but not limited to claims based on the federal Fair Labor Standards Act, the California Labor Code, or any similar local law, ordinance or policy (collectively “Covered Claims”). As to any Covered Claim, each party waives to the maximum extent permitted by law the right to jury trial and to bench trial, and the right to bring, maintain, or participate in any class, collective, or representative proceeding, including but not limited to under [California's Private Attorneys General Act] or any other applicable similar laws, whether in arbitration or otherwise, to the full extent permitted by applicable law.

Rather than allowing union members to file suit, the CBA's Wage and Hour Protocol “makes mediation and arbitration the sole and exclusive method of resolving all individual or group Covered Claims applicable to bargaining unit employees, even where the Union has declined to bring such Covered Claims to arbitration.” Acevedo attests that she was unaware that she was a union member until after she began working at ABM, was never told that she would be required to arbitrate any claims against ABM, did not see the CBA until ABM filed its motion, and does not understand the English-language CBA or its arbitration provisions in part because she does not read English fluently.

Acevedo filed this action against ABM in Santa Clara County Superior Court, asserting individual and class claims for ABM's alleged violations of the California Labor Code, including alleged failures to pay overtime or minimum wages, provide meal or rest periods, timely pay wages during employment, pay all wages due upon termination, provide accurate wage statements, and comply with Labor Code §§ 2901 and 227.3. The complaint also included a derivative claim under California's Unfair Competition Law (UCL), Cal. Bus. & Prof. Code § 17200.

ABM removed the case from state court to this Court pursuant to 28 U.S.C. §§ 1332(d)(2) and 1453(b).¹ Now before the Court is ABM's motion to dismiss Acevedo's complaint under Federal Rule of Civil Procedure 12(b)(6) for failure to state a claim upon which relief may be granted. In the alternative, ABM moves to strike Acevedo's class claims and compel arbitration of all her remaining claims under either the CBA or MAA.

LEGAL STANDARD

The Federal Arbitration Act (FAA) provides that a “written provision in ․ a contract evidencing a transaction involving commerce to settle by arbitration a controversy thereafter arising out of such contract or transaction ․ shall be valid, irrevocable, and enforceable, save upon such grounds as exist at law or in equity for the revocation of any contract.” 9 U.S.C. § 2. As this language makes clear, “an arbitration agreement is a contract like any other.” Bielski v. Coinbase, Inc., 87 F.4th 1003, 1009 (9th Cir. 2023). The FAA “requires courts to rigorously enforce agreements to arbitrate.” Johnson v. Walmart, Inc., 57 F.4th 677, 681 (9th Cir. 2023). Like other contracts, arbitration agreements are subject to “generally applicable contract defenses” like “fraud, duress, or unconscionability.” Lim v. TForce Logs., LLC, 8 F.4th 992, 999 (9th Cir. 2021).

In deciding on a motion to compel arbitration, a court must determine “(1) whether a valid agreement to arbitrate exists and, if it does, (2) whether the agreement encompasses the dispute at issue.” Chiron Corp. v. Ortho Diagnostic Sys. Inc., 207 F.3d 1126, 1130 (9th Cir. 2000). The summary judgment standard applies. Hansen v. LMB Mortg. Servs., Inc., 1 F.4th 667, 670 (9th Cir. 2021). Thus, the Court must “give to the opposing party the benefit of all reasonable doubts and inferences.” Sanford v. MemberWorks, Inc., 483 F.3d 956, 963 (9th Cir. 2007).

ANALYSIS

ABM asks that the Court strike Acevedo's class and representative claims, dismiss certain of her individual claims on the ground that they are preempted by the federal Labor Management Relations Act, and compel arbitration of the remaining claims. But “a court may not decide a merits question that the parties have delegated to an arbitrator[.]” Henry Schein, Inc. v. Archer & White Sales, Inc., 586 U.S. 63, 69, 139 S.Ct. 524, 202 L.Ed.2d 480 (2019). Because Acevedo's claims are arbitrable for the reasons explained below, the Court need not—indeed, cannot—address ABM's merits arguments.

“[T]he first question in any arbitration dispute must be: What have these parties agreed to?” Coinbase, Inc. v. Suski, 602 U.S. 143, 148, 144 S.Ct. 1186, 218 L.Ed.2d 615 (2024). Where there are multiple contracts governing the parties’ relationship, answering that question requires a court to first determine what contract applies to the dispute. Id. at 149, 144 S.Ct. 1186. Here, two contracts—the CBA and the MAA—govern the parties’ relationship, and their arbitration provisions differ. But the MAA expressly provides that it does not cover any “disputes covered by a Collective Bargaining Agreement.” Thus, if the CBA's Wage and Hour Protocol applies to the present dispute, that provision controls.

To determine whether the CBA's Wage and Hour Protocol applies here, the Court must assess (1) whether the agreement is valid and enforceable and (2) whether it encompasses the present dispute. Chiron, 207 F.3d at 1130.

The CBA, including its Wage and Hour Protocol, purports to waive Acevedo's individual right to pursue her Labor Code claims in court. Though Acevedo did not personally agree to the CBA or its arbitration requirements, unions in California may “waive the rights of union members even without explicit, individual consent of each member” so long as such waivers are “clear and unmistakable.” Rymel v. Save Mart Supermarkets, Inc., 30 Cal. App. 5th 853, 859, 241 Cal.Rptr.3d 832 (2018); see also Wright v. Universal Mar. Serv. Corp., 525 U.S. 70, 80, 119 S.Ct. 391, 142 L.Ed.2d 361 (1998). To be clear and unmistakable, a waiver of a statutory right in a union agreement must be “explicitly stated.” Wright, 525 U.S. at 80, 119 S.Ct. 391. Several district courts in this state have interpreted that instruction to mean that a union agreement's waiver of an individual's statutory right to a judicial forum is valid only if the agreement explicitly refers to the statute under which that right arises. See, e.g., Smith v. Serv. Emps. Int'l Union, Loc. 521, No. 16-CV-02547-LHK, 2016 WL 4268713, at *8 (N.D. Cal. Aug. 14, 2016); Vasserman v. Henry Mayo Newhall Mem'l Hosp., 65 F. Supp. 3d 932, 964 (C.D. Cal. 2014); Martinez v. J. Fletcher Creamer & Son, Inc., No. CV 10-0968 PSG, 2010 WL 3359372, *3 (C.D. Cal. Aug. 13, 2010).²

Here, the CBA's arbitration provision explicitly refers to “the California Labor Code” and notes that the parties agree to waive covered employees’ right to pursue individual litigation in court of all claims arising under the provisions of that Code concerning wages, hours, and meal and rest periods. Other district courts have found similar provisions referring to claims under the Labor Code to clearly and unmistakably waive plaintiffs’ right to a judicial forum for Labor Code claims. See, e.g., Ramirez de Portillo v. Metro Servs. Grp., No. 24-CV-02118-LB, 2025 WL 1644279, at *8 (N.D. Cal. June 10, 2025); Gutierrez v. Anning-Johnson Co., No. CV2106117JAK, 2023 WL 3852675, at *14–15 (C.D. Cal. June 6, 2023). This Court reaches the same conclusion. Indeed, the only manner in which the waiver could be any clearer would be for it to list each and every provision of the Labor Code separately. But any such list would be a mere formality because it would not offer any meaningfully useful additional information to the parties to the agreement or to covered employees.

Acevedo nonetheless argues that the CBA is unenforceable because it is unconscionable. In California, “[a] contract is unconscionable if one of the parties lacked a meaningful choice in deciding whether to agree and the contract contains terms that are unreasonably favorable to the other party.” OTO, L.L.C. v. Kho, 8 Cal. 5th 111, 125, 251 Cal.Rptr.3d 714, 447 P.3d 680 (2019). Unconscionability includes both “a procedural and a substantive element.” Id. The procedural element addresses the process by which the parties formed the contract and the substantive element addresses the fairness of the contract's terms. Id. “[P]rocedural and substantive unconscionability must both be present in order for a court ․ to refuse to enforce a contract or clause,” but “they need not be present in the same degree.” Armendariz v. Found. Health Psychcare Servs., Inc., 24 Cal. 4th 83, 114, 99 Cal.Rptr.2d 745, 6 P.3d 669 (2000).

Whether or not the CBA is substantively unconscionable, Acevedo has not shown that it is procedurally unconscionable.³ She argues that the CBA is procedurally unconscionable because it is an adhesive contract and she had no opportunity to negotiate or opt out of its provisions. As another court recently explained in response to a similar argument, however:

[T]he union negotiated the CBA on behalf of its members—present and future. And “[t]he NLRA was enacted to remedy the inequality of bargaining power between employees ․ and employers.” Cal. Grocers Ass'n v. City of Los Angeles, 52 Cal. 4th 177, 195, 127 Cal.Rptr.3d 726, 254 P.3d 1019 (2011). Here, the CBA was not a standardized contract drafted by the employer, instead it was mutually arrived at after a negotiation process. Moreover, the employer did not have superior bargaining power given that it was negotiating with a union made up of hundreds of employees. As such, ․ the CBA [and] its arbitration provision did not involve oppression or surprise, and thus they are not procedurally unconscionable.

Allmaras v. Univ. Mechanical & Engineering Contractors, Inc., 757 F.Supp.3d 1094, 1111–12 (S.D. Cal. 2024); see also Hussein v. Marin Gen. Hosp., No. 24-CV-06296-KAW, 2025 WL 56416, at *5 (N.D. Cal. Jan. 9, 2025) (finding no procedural unconscionability in agreement between employer and union absent showing of unequal bargaining power). Because Acevedo has not established procedural unconscionability or identified any other reason why the CBA is unenforceable, the Court concludes that the CBA is valid and enforceable.

The Court must next consider whether the CBA's Wage and Hour Protocol encompasses this dispute. The protocol requires arbitration of “all claims alleging violations of wage and hour and/or meal and rest period laws, including but not limited to claims based on the federal Fair Labor Standards Act, the California Labor Code, or any similar local law, ordinance or policy.” It further specifies that the covered parties include ABM, the union, and the individual employee bringing a claim. This language plainly encompasses Acevedo's claims against ABM under the California Labor Code, as such claims all relate to violations of the Labor Code's requirements concerning wages, hours, and meal and rest periods. And because Acevedo's final claim under the UCL is entirely derivative of her arbitrable Labor Code claims, it is also subject to the Wage and Hour Protocol. See Allmaras, 757 F. Supp. 3d at 1111; Reyna v. WestRock Co., 2020 WL 5074390, at *11–12 (N.D. Cal. Aug. 24, 2020).

Acevedo nonetheless argues that the protocol applies only to state-law claims that are preempted by the federal Labor Management Relations Act (LMRA), 29 U.S.C. § 185(a). In support of her argument, Acevedo relies on Jones v. Sysco Ventura, Inc., which held that “[w]hen a plaintiff's claims are preempted by the LMRA, ‘the terms of the CBA control,’ including the CBA's dispute resolution provisions.” No. 21-cv-04116, 2021 WL 6104193 (C.D. Cal. 2021). Acevedo reasons that the inverse must also be true—i.e., that the CBA does not control if a plaintiff's claims are not preempted by the LMRA. Dkt. No. 14 at 21. But Jones was simply restating the established rule that “to the extent any ‘alleged independent agreement conflicts with a CBA’,” the LMRA instructs that “the terms of the CBA control.” 2021 WL 6104193, at *10 (emphasis added) (quoting Brown v. Lucky Stores, Inc., 246 F.3d 1182, 1189 (9th Cir. 2001)). At most, Jones suggests that even if the MAA did not expressly yield to the CBA, the CBA would still control. It does not suggest that the CBA's Wage and Hour Protocol is inapplicable absent LMRA preemption. Under the FAA, that question is governed not by the LMRA but by the terms of the Wage and Hour Protocol, which broadly cover all claims under California's Labor Code relating to wages, hours, and meal and rest periods. The Court therefore need not determine whether the LMRA preempts any of Acevedo's claims.⁴

In sum, the CBA's Wage and Hour Protocol is an enforceable contractual agreement to arbitrate that covers the present dispute. Accordingly, Acevedo's claims against ABM must be pursued in arbitration rather than in this forum.

CONCLUSION

For the foregoing reasons, the Court grants ABM's motion to compel and orders the parties to arbitrate all of the claims against ABM in Acevedo's complaint pursuant to the CBA's Wage and Hour Protocol. At Acevedo's request, the Court stays the proceedings in this case pending mediation or arbitration. See 9 U.S.C. § 3; Smith v. Spizzirri, 601 U.S. 472, 478, 144 S.Ct. 1173, 218 L.Ed.2d 494 (2024). By no later than March 1 and September 1 of each year, ABM shall provide the Court with an update on the status of the arbitration proceedings.

IT IS SO ORDERED.

FOOTNOTES

1.   Acevedo does not contest this Court's jurisdiction, and the Court has independently reviewed the pleadings and found no basis for questioning that the requirements for federal jurisdiction are present.

2.   At least two panels of the Ninth Circuit have suggested the same in nonprecedential dispositions. See Wawock v. CSI Elec. Contractors, Inc., 649 F. App'x 556, 558 (9th Cir. 2016); Powell v. Anheuser-Busch Inc., 457 F.App'x 679, 679 (9th Cir. 2011).

3.   Acevedo argues that the CBA is substantively unconscionable in part because it categorically waives representative PAGA claims. See Adolph v. Uber Technologies, Inc., 14 Cal.5th 1104, 1117, 310 Cal.Rptr.3d 668, 532 P.3d 682 (2023) (holding that such waivers violate California public policy and are unenforceable). In 2021, however, the California legislature amended the Labor Code to permit waivers of representative PAGA claims for certain “janitorial employees” like Acevedo whose employment is governed by a CBA offering certain employee protections. See Cal. Lab. Code § 2699.8. ABM contends that the CBA falls within this exception, and Acevedo has not argued otherwise. See Sanchez v. Valencia Holding Co., LLC, 61 Cal. 4th 899, 911, 190 Cal.Rptr.3d 812, 353 P.3d 741 (2015) (“[T]he party asserting [unconscionability] bears the burden of proof.”). Ultimately, the Court need not determine whether the CBA's PAGA waiver renders the agreement substantively unconscionable in the absence of any procedural unconscionability.

4.   There is good reason to think that it does not. See, e.g., Hernandez v. Pac. Underground Constr., Inc., 794 F.Supp.3d 696 (N.D. Cal. 2025) (finding no LMRA preemption of comparable California Labor Code claims).

P. Casey Pitts, United States District Judge