Hill v. Garda CL Northwest

Garda CL Northwest, Inc. (Garda) (defendant) was an armored-truck company in Washington state. Lawrence Hill and other individuals (employees) (plaintiffs) were employees of Garda. Employees were required to sign a labor agreement negotiated between Garda and employee associations. The associations represented the employees but were not considered unions because they did not collect dues and had no association-specific resources. The employee associations did not file grievances on behalf of employees because they did not have the funds to do so. Little bargaining typically occurred in creating the agreements, and employees generally had to accept whatever agreements were offered. The labor agreement had an arbitration clause that included a 14-day statute of limitations on claims, two- and four-month limitations on backpay damages depending on the agreement, and a fee-sharing provision. The fee-sharing provision stated that the association and Garda would each pay half of many of the arbitration costs. No employee had attempted to use the grievance procedures outlined in the agreement for almost 20 years. The employees brought suit in state court for wage-and-hour violations under state law. The employees filed a motion for class certification, and Garda filed a motion to compel arbitration, citing its labor agreements. The trial court granted the class certification and ordered class arbitration. Garda appealed the trial court’s decision to allow class arbitration, and the employees appealed the decision to compel arbitration, claiming that the arbitration clause was unconscionable and unenforceable. The court of appeals affirmed the compelled arbitration but reversed the decision to allow class arbitration. The employees appealed the decision to the Washington Supreme Court, which considered the unconscionability of the clause.