Century Fast Foods, Inc.

National Labor Relations Board - Administrative Judge Opinions

Apr 24, 2015

31-CA-116102 (N.L.R.B. Apr. 24, 2015)

JD(SF)–17–15
Chatsworth, CA
UNITED STATES OF AMERICA
BEFORE THE NATIONAL LABOR RELATIONS BOARD
DIVISION OF JUDGES
SAN FRANCISCO BRANCH OFFICE
CENTURY FAST FOODS, INC.
and Case 31–CA–116102
WILLIAM LUJAN, an Individual
Rudy L. Fong Sandoval, Esq.
for the General Counsel.
Lonnie D. Giamela, Esq. (Fisher & Phillips, LLP)
for the Respondent.
DECISION
STATEMENT OF THE CASE
ARIEL L. SOTOLONGO, Administrative Law Judge. This is another case in a steady
stream of cases, by now numerous, that raise issues related to the Board’s decisions in D.H.
Horton, Inc., 357 NLRB No. 184 (2012), enf. denied in relevant part 737 F.3d 344 (5th Cir.
2013), petition for rehearing en banc denied (5th Cir. No. 12-60031, April 16, 2014), and more
recently, Murphy Oil USA, Inc., 361 NLRB No. 72 (2014), where the Board reaffirmed and
further elaborated on the principles announced in D.H. Horton. This case is before me based on
a Joint Motion to Transfer Proceedings to the Division of Judges and Stipulation of Issues
Presented (Joint Motion), which contained a stipulated record attaching certain documents,
referenced in the Stipulation of Facts that was also part of the Joint Motion, as set forth below.1
FINDINGS OF FACT
In their Stipulation of Facts (SOF), which is part of the Joint Motion, the parties agreed to
the following facts:

1 I granted the initial Joint Motion on December 19, 2014. Thereafter, on March 26, 2015,
the parties submitted a Corrected Joint Motion, which included some missing pages from the
attached documents in the original Joint Motion. I granted the Corrected Joint Motion on the
same day.
JD(SF)–17–15
1. (a) The charge in this proceeding was filed by the Charging Party on
October 30, 2013, and a copy was served by regular mail on Respondent on November 5, 2013.
(b) The first amended charge in this proceeding was filed by the Charging Party on
January 28, 2014, and a copy was served by regular mail on Respondent on February 3, 2014.5
2. (a) At all material times, Respondent has been a corporation with an office and place
of business in Los Angeles and a facility in Chatsworth, California, where Respondent has been
engaged in operating public restaurants selling food and beverages.
10
(b) In conducting its operations during the 12-month period ending
November 25, 2013, Respondent purchased and received at its Chatsworth, California facility
goods and services valued in excess of $5,000 directly from points outside the State of
California.
15
(c) In conducting its operations during the 12-month period ending
November 25, 2013, Respondent derived gross revenues in excess of $500,000.
3. At all material times, Respondent has been an employer engaged in commerce within
the meaning of Section 2(2), (6), and (7) of the Act.220
4. Charging Party William A. Lujan (Lujan) is a former employee of Respondent. Lujan
worked for Respondent from about November 2, 2012 through February 13, 2013.
5. In seeking employment with Respondent, Lujan filled out, signed and dated, an25
application for employment on October 22, 2012, attached hereto as Exhibit A [of the Joint
Motion] (employment application). The employment application does not have an “opt out”
provision.
6. (a) The employment application signed by Lujan is standardized and contains a30
section entitled “Agreement to Arbitrate,” (arbitration provision) which reads:
Agreement to Arbitrate. Because of the delay and expense of the court system, TACO
BELL and I agree to use confidential binding arbitration, instead of going to court, for
any claims that arise between me and Taco Bell, its related companies, and/or their 35
current or former employees. Without limitation, such claims would include any
concerning compensation, employment including, but not limited to, any claims
concerning sexual harassment or discrimination, or termination of employment. Before
arbitration I agree: (i) first to present any such claims in full written detail to TACO
BELL; (ii) next, to complete any TACO BELL internal review process; and (iii) finally, 40
to complete any external administrative remedy (such as with the Equal Employment

2 In light of the factual stipulation contained in paragraph 2(a) through (c) above, I concur
with the stipulation contained in paragraph 3, and conclude that at all times material herein, the
Respondent has been an employer engaged in commerce within the meaning of Section 2(2), (6),
and (7) of the Act.
JD(SF)–17–15
3
Opportunity Commission). In any arbitration, the then prevailing employment dispute
resolution rules of the American Arbitration will apply, except that TACO BELL will pay
the arbitrator’s fees, and TACO BELL will pay that portion of the arbitration filing fee in
excess of the similar court filing fee had I gone to court.
5
(b) Multiple former and current employees of Respondent have executed the
arbitration provision given to Lujan on October 22, 2012, as part of Respondent’s hiring process.
7. As part of Respondent’s hiring process, from October 22, 2012 through
February 12, 2013, Respondent required all job applicants, including Lujan, to sign and date the 10
employment application described above, in paragraph 5.
8. It is Respondent’s position that agreement to abide by the arbitration provision
contained in employment application was not a required condition of employment for an
applicant to be hired by Respondent.15
9. It is General Counsel’s position that agreement to abide by the arbitration provision
contained in the employment application was a required condition of employment for an
applicant to be hired by Respondent.
20
10. About July 2, 2013, Charging Party Lujan filed a class action complaint in the
Superior Court of the State of California, County of Los Angeles, Case No. BC513815
(Superior Court), attached hereto as Exhibit B [of the Joint Motion], alleging wage-and-hour and
other violations under the California Labor Code and the California Business and Professions
Code.25
11. About October 24, 2013, Respondent filed a Notice of Motion and Motion to Compel
Arbitration on an Individual Basis, Strike the Class Allegations and to Stay the Proceedings
Pending Arbitration, filed concurrently with Notice of Motion; Declaration of Sheila Cook;
Declaration of Lonnie D. Giamela, collectively attached hereto as Exhibit C [of the Joint 30
Motion], (Motion to Compel) with the Superior Court.
12. About January 6, 2014, Charging Party Lujan filed an opposition to Respondent’s
Motion to Compel, filed concurrently with Lujan’s declaration, attached hereto as Exhibit D [of
the Joint Motion]. As noted by Lujan in Lujan’s Declaration in support of the opposition, at 35
paragraph 4: “During my application process, I was given a job application form. I was told by
Jesse Suarez, the store manager that I needed to fill out the application, sign and date it. I was not
given an opportunity to negotiate the employment application’s terms or strike any terms in the
application—it was a take-it-or-leave-it form.” Nowhere in Lujan’s declaration does it indicate
that any agent of Respondent indicated that the application was a “take it or leave it form.”40
13. Lujan was under the age of eighteen at the time he signed the employment
application containing the arbitration provision. As noted in Lujan’s opposition to Respondent’s
Motion to Compel, noted above and attached hereto as Exhibit D [of the Joint Motion], Lujan’s
legal counsel took the position in those proceedings that Lujan was protected by the “infancy 45
doctrine” which permitted him to disaffirm the arbitration provision.
JD(SF)–17–15
4
14. On March 10, 2014, the Superior Court granted Respondent’s Motion to Compel,
attached hereto as Exhibit F [of the Joint Motion], severing from the arbitration provision the
three-part internal review procedure as well as the “confidential” nature of the arbitration
provision. Charging Party appealed the matter to the California Court of Appeals.5
15. Respondent and Charging Party, on August 22, 2014, came to a resolution of all
claims to the underlying class action complaint, including resolution of the Motion to Compel
and appeal noted herein. The settlement did not resolve any class allegations as the class
allegations were dismissed by the civil court. Thereafter, the Regional Director of the NLRB 10
Region 31, did not approve Charging Party’s withdrawal request of the underlying unfair labor
practice matter, because the Regional Director determined settlement of the underlying civil
class action complaint does not remedy the Section 8(a)(1) allegations in the instant complaint.
DISCUSSION AND ANALYSIS15
The parties, in the Joint Motion, also stipulated that the issues presented in this case are
as follows:
ISSUE 1(a): Did Respondent violate Section 8(a)(1) by maintaining and enforcing its 20
mandatory arbitration provision, which it required employees to sign as a condition of
employment, as alleged in the instant Complaint, by filing its October 24, 2013 Motion to
Compel Charging Party Lujan to individually arbitrate class wage and hour claims?
ISSUE 1(b): Did Respondent violate Section 8(a)(1) by maintaining and enforcing its 25
mandatory arbitration provision, as alleged in the instant Complaint, by filing its
October 24, 2013 Motion to Compel Charging Party Lujan to individually arbitrate class
wage and hour claims, even if employees were not required to sign the arbitration provision
as a condition of employment.
30
ISSUE 2: Whether Respondent’s mandatory arbitration provision, subject of Respondent’s
October 24, 2013 Motion to Compel Charging Party Lujan to individually arbitrate class
wage and hour claims, violates Section 8(a)(1) of the Act by restricting access to the Board
and its processes, as alleged in the instant Complaint.
35
ISSUE 3: Whether Respondent’s mandatory arbitration provision, executed by Charging
Party Lujan, subject of Respondent’s October 24, 2013 Motion to Compel Arbitration on an
Individual Basis, violates Section 8(a)(1) of the Act by requiring that employees use
“confidential arbitration” thereby prohibiting employees from discussing their terms and
conditions of employment, as alleged in the instant Complaint.40
1. Whether the “Agreement To Arbitrate” is a condition of employment
In order to decide the above-stipulated issues, however, a more basic and fundamental
issue must first be decided, the answer to which is the key to decide the rest: Did Lujan enter 45
into the above-described Agreement to Arbitrate (ATA) voluntarily or was agreeing to the ATA
a condition of hire and thus a term and condition of employment? Respondent avers that Lujan
JD(SF)–17–15
5
agreed to enter the ATA voluntarily, whereas the General Counsel argues that it was a condition
of employment. As discussed below, if I find that the ATA was a mandatory condition of
employment, the Board’s rulings in D.R. Horton and Murphy Oil, supra, would suggest that at
least some aspects of the ATA and its ramifications violated Section 8(a)(1) of the Act. If, on the
other hand, I find that Lujan entered into the ATA voluntarily, and that it was not a condition of 5
employment, the same violations might not exist.
Initially, I note that the ATA is silent on the issue; there is no language in the ATA itself
that explicitly mandates that an employee sign it in order to gain or maintain employment.
Accordingly, I must decide whether in light of the circumstances there was an implicit10
requirement that Lujan sign the ATA as a condition of employment.
In that regard, I first note that at the time of signing, Lujan was under 18 years of age, and
thus a minor. (Stipulation of Facts [SOF], ¶ 17). Second, I note that the ATA appears to be part
of the employment application itself, appearing on the bottom half of the second page, just above 15
the signature line for the applicant, and that the language of the ATA is in very small print,
barely legible.3 Additionally, I note that Respondent’s Store Manager, Jesse Suarez, gave Lujan
the application and told him to fill it out and sign it, without more, and that although no one told
Lujan that it was a “take it or leave it” proposition, that is how Lujan interpreted it. (SOF, ¶ 12).
Finally, I note that there is no “opt out” provision in the ATA (SOF ¶ 5), and that multiple 20
former and current employees of Respondent have executed the same ATA as part of
Respondent’s hiring process (SOF ¶ 6(b)). Although the SOF is silent on this issue, I find that it
is reasonable to infer that no successful job applicant has ever refused to agree to the ATA, since
the hiring of such individual under those circumstances would be a significant, even crucial, fact
in favor of Respondent’s position that the ATA was not a condition of employment. Thus, the 25
mere fact that Respondent has not proffered such evidence or insisted that it be made part of the
SOF signals that this has never occurred, most likely because no applicant believed that the job
application would be accepted or approved if the candidate did not sign such provision. Indeed,
as described above, looking at the application itself, there are no separate signature lines for the
ATA and the rest of the application; there is only one single signature line at the bottom of page 30
2 of the application immediately after the ATA. (SOF Exhibit A, p. 1–2). Thus, the ATA appears
to be an organic component of the application for employment itself, and not a separate or
separable component. There is absolutely no indication in the application form that would even
indirectly suggest to the applicant that the ATA portion could be declined or severed from the
rest of the application.35
Taking all the above factors into account, I conclude that any job applicant in the same
circumstances would reasonable conclude that he/she could not “opt out” of the ATA, and would
reasonably believe that agreeing to the ATA was a necessary and mandatory component of the
application process itself. I find that it was thus reasonable for Lujan—and any other 40

3 Although the SOF makes no mention of this, I assume that the copy of the application that
is attached as SOF Exhibit A, pages A-1 and A-2, is a true copy of the application for
employment submitted by Lujan, which reflects the actual size of the application and the font
size contained in such document. Even if a true copy of the application and the size of the font
was larger, however, it would not impact my conclusions, as discussed below.
JD(SF)–17–15
6
candidate—to conclude that the whole application, including the ATA, was a “take it or leave it”
proposition. Indeed, there is additional circumstantial evidence suggesting that Respondent
viewed the ATA as a mandatory condition of employment. Thus, as described in the SOF, on or
about October 4, 2013, Respondent filed a Motion to Compel Arbitration in the Superior Court
of the State of California (SOF ¶ 11). In its Memorandum of Points and Authorities in support of 5
its Motion to Compel (SOF Exhibit C, p.14–15) filed with the court, Respondent, citing
California case precedent, indicates that when an employer imposes mandatory arbitration as a
condition of employment (emphasis supplied), the employee cannot be made to bear the costs of
arbitration. In refuting the claimant’s defense in its state court pleadings that the ATA was
“unconscionable” under California law, Respondent argues that the ATA provides that 10
Respondent bears the costs of any arbitration under its terms, and therefore complied with
California law requiring that employers bear the cost of arbitration imposed on employees. Such
argument reasonably implies that Respondent concedes that the ATA was a mandatory condition
of employment, or would likely be found to be such in state court. Simply put, I cannot imagine
that Respondent would otherwise have included such language in the ATA agreeing to bear the 15
costs of arbitration.
Accordingly, and for the reasons set forth above, I conclude that the ATA was a
mandatory condition of employment. This conclusion partly answers issues 1(a) and 1(b) as
stipulated by the parties and as set forth above, which posed the question whether the ATA was a 20
mandatory condition of employment.
2. Whether Respondent violated the Act by maintaining and enforcing a mandatory
arbitration provision
25
I now turn to the rest of the substantive issues posed by issues 1(a) and 1(b), namely
whether Respondent violated Section 8(a)(1) of the Act, as alleged in the complaint paragraph(s)
5(b) and (c), by filing its October 24, 2013 Motion to Compel Lujan to individually arbitrate
class wage and hour claims.
30
It is clear that the Board’s decisions in D.R. Horton and Murphy Oil, supra, are
dispositive of these issues. In Murphy Oil, the Board reaffirmed its ruling in D.R. Horton that an
employer violates Section 8(a)(1) of the Act when it requires employees, as a condition of
employment, to enter into arbitration agreements that preclude them from filing class action suits
regarding their wages, hours and other conditions of employment. As discussed above, I have 35
concluded that the ATA was a mandatory condition of employment. Although the ATA itself is
silent on the issue of employees bringing class actions, Respondent tipped its hand when it filed
its Motion to Compel Arbitration on an Individual Basis (and striking class action) in California
State Court. This type of action was found unlawful by the Board in Murphy Oil, citing D.R.
Horton, the only distinction being that the court action filed by the employer in that case was in 40
federal court, as opposed to a state court action in the present case—a distinction without a
difference. I find it unnecessary to explain or elaborate regarding the Board’s rationale for its
rulings in D.R. Horton and Murphy Oil, both which provide lengthy analysis and discussions of
these issues. By now, there have been multiple cases heard by Board administrative law judges
throughout the country regarding these issues since the Board decided D.R. Horton, and multiple 45
cases now pending before the Board on these matters. Although the facts in each of these cases
JD(SF)–17–15
7
may vary somewhat, the universal theme in most, if not all of them, is the validity of compulsory
arbitration agreements that preclude employees from seeking class action litigation to vindicate
their rights. Almost without exception, these types of compulsory arbitration agreements have
been found to be unlawful, as have employer actions to enforce such agreements. These issues
can fairly be described as controversial, particularly in light of the 5th Circuit Court of 5
Appeals’—and arguably other Circuits’—disagreement with the Board’s ruling in D.R. Horton,
but by now the Board’s position on these matters is clear and well publicized.
In that regard, I note that in its brief Respondent makes an impassioned argument against
the Board’s ruling in D.R. Horton and Murphy Oil, citing the courts’ rejection of the Board’s 10
ruling and rationale in D.R. Horton, which Respondent argues was wrongly decided. Suffice it
to say, however, that in the absence of a Supreme Court ruling on this line of cases, I am
compelled to follow the Board’s rulings, not the rulings of any Circuit court. Pathmark Stores,
342 NLRB 378, fn. 1 (2004); Waco, Inc., 273 NLRB 746, 749 fn. 14 (1984); Iowa Beef Packers,
144 NLRB 615, 616 (1963), enfd. in part, 331 F.2d 176 (8th Cir. 1964). Thus, unless there is an 15
unexpected reversal by the Board on its views in these matters in the near future, it is reasonable
to infer that the Board will continue on this path unless the Supreme Court overrules it, or until
all Circuit courts disagree with the Board and its orders become unenforceable. This last
scenario would, at least in the near future, be very unlikely for purely logistical reasons if
nothing else. In that regard I note that many of the cases now pending before the Board were not 20
actually litigated, but rather submitted via stipulated records, as the present case was, in order to
“fast track” these issues to the Board, and eventually to the Circuit courts in order for employers
to test the Board’s Horton doctrine. Thus, employers—and their representatives—are by now on
notice that the Board will continue to find these types of compulsory arbitration agreements and
actions to enforce them to be unlawful.4 25
Respondent additionally makes what I believe is a novel argument: that the State of
California (or its Supreme Court) should be joined as an indispensable party in this matter
because the California Supreme Court has ruled that under California law class action waivers
are enforceable, and because the lower state court (California Superior Court) was responsible 30
for the ruling that the ATA’s silence regarding class actions must be interpreted as prohibiting

4 A possible exception to the likelihood of this outcome involves situations where employees
are allowed to “opt out” of arbitration agreements, so that those who choose not to opt out can be
said to have voluntarily agreed to such arbitrations. This possibility was raised by the Board in
footnote 28 of its Horton decision, where it indicated that a “more difficult question” would be
posed where an employer and employee entered into an arbitration agreement that was not a
condition of employment to resolve either a particular dispute or all potential disputes through
nonclass arbitration rather that litigation in court. The Board has yet to answer its own question,
but at least two administrative law judge decisions have addressed this issue, finding that these
types of voluntary agreements do not violate the Act. See, e.g., Bloomingdale’s, Inc., JD (SF)-
29-13 (May 25, 2013); and Valley Health System LLC, JD(SF)-08-15 (March 18, 2015). Other
administrative law judges have disagreed—See e.g., Kenai Drilling Limited, JD (SF)-13-15
(April 13, 2015); RPM Pizza, JD (ATL)-20-14 (July 11, 2014).
JD(SF)–17–15
8
such actions.5 This argument is not valid, for a couple of reasons. First, in Iskanian (see fn. 5,
below), the California Supreme Court indicated that its ruling finding class action waivers
enforceable was mandated by the U.S. Supreme Court’s ruling in AT&T Mobility LLC v.
Concepcion, ___ US___, 131 S.Ct. 1740 (2011) (Concepcion), which pursuant to the Federal
Arbitration Act (FAA) reversed a prior California Supreme Court ruling that had restricted class 5
action waivers in arbitration agreements. Thus, it is incorrect to suggest, as Respondent does,
that its actions are mandated by California law in contravention of the Board’s D.R. Horton and
Murphy Oil rulings. In both Horton and Murphy Oil the Board explains why the U.S. Supreme
Court’s ruling in Concepcion is inapplicable to situations involving employees in the exercise of
Section 7 rights. Simply put, California law or its interpretation by the California courts has 10
nothing to do with the legality of Respondent’s conduct, which in this case is subject to federal
labor laws.6 Thus, Board law is controlling in this instance, and to the extent that California law
conflicts with federal law in this matter, federal law preempts California law, which was the very
basis for the Concepcion ruling.
15
Secondly, regarding Respondent’s argument that it was the lower state court (California
Superior Court) which ruled that the ATA’s silence on the issue of class arbitrations amounted to
a prohibition of such class actions—thus implying that Respondent had no choice in the
matter —, such ruling was again mandated by an earlier U.S. Supreme Court decision in Stolt-
Nielsen S.A. v. Animal Feeds International Corp, 559 U.S. 662 (2010) a ruling which was 20
followed by the California Court of Appeal in Nelsen v. Legacy Partners Residential, Inc., 207
Cal.App.4th 1115, 1128 (2012). Indeed, this is pointed out by Respondent in its Memorandum
of Points and Authorities in support of its Motion to Compel (SOF Exhibit C, p. 12–13). Thus,
Respondent knew, or should have known, as early as 2010, when the Supreme Court decided
Stolt-Nielsen, and certainly by 2012, when the California Court of Appeal decided Nelsen, that 25
an arbitration agreement’s silence on the issue of class arbitration meant that such class actions
would be precluded.7 When Respondent proffered Lujan the job application containing the ATA
on October 22, 2012, for him to sign, it knew, or should have known, that the ATA’s silence
sealed the fate of class arbitrations, as a matter of federal and state law. Respondent could have
proffered Lujan an arbitration agreement that explicitly did not preclude class action, or at least 30
allowed him to “opt out” of any restrictive arbitration agreement, but did not do so. Respondent
thus knew it was forcing Lujan and others into individual arbitrations when it proffered the
application form, including the ATA, to its job applicants. Accordingly, Respondent’s attempt to
divert responsibility for its conduct to the state of California fails, and it is not necessary to join
California, or any of its political subdivisions, as an “indispensable” party, because they are not.35
For the above reasons, I conclude that Respondent violated Section 8(a)(1) of the Act by
maintaining and enforcing a mandatory arbitration provision, as alleged in paragraphs 5(a), 5(b),
and 8 of the complaint.

5 Respondent cites the California Supreme Court’s ruling in Iskanian v. CLS Transportation
Los Angeles, LLC, 59 Cal.4th 348, 366–374 (2014).
6 Thus, the fact that the California Supreme Court, in Iskanian, agreed with the Fifth
Circuit’s ruling on D.R. Horton and rejected the Board’s rationale in that case is of little
consequence, since a state court’s rulings carry no weight on matters of federal labor law.
7 Nelsen was decided on July 18, 2012.
JD(SF)–17–15
9
3. Whether Respondent violated Section 8(a)(1) of the Act by maintaining and enforcing a
mandatory arbitration provision that restricts access to the Board and its processes
I now turn to the question of whether the language of the ATA restricted Lujan, or other 5
employees, from access to the Board’s processes in violation of Section 8(a)(1) of the Act.
Pursuant to the Board’s ruling in Lutheran Heritage Village-Livonia, 343 NLRB 646 (2004),
I must first determine if the ATA explicitly restricts activities protected by Section 7. If so, the
ATA is unlawful. If the ATA does not explicitly restrict Section 7 rights, I must examine the
following criteria: (1) whether employees would reasonably construe the language to prohibit (or 10
restrict) Section 7 activity; (2) whether the ATA was promulgated in response to union activity;
(3) whether the ATA has been applied to restrict the exercise of Section 7 rights. Lutheran
Heritage, at 647. See also, U-Haul Co. of California, 347 NLRB 375, 377 (2006), enfd. 255
Fed.Appx. 527 (D.C. Cir. 2007); D.R. Horton, supra.
15
As discussed previously, the ATA is silent on the question of class action preclusion, and
does not explicitly prohibit filing charges with the Board or explicitly restrict other Section 7
activity-except, as will be discussed below, with regard to the confidentiality of the arbitration
process. Additionally, there is no evidence that the ATA was promulgated in response to union
activity, so criteria number 2, above, is not applicable. Finally, there is no evidence that 20
Respondent applied the ATA to restrict employee access to the Board’s processes, so criteria
number 3 is likewise not applicable. The question of whether the ATA restricts access to the
Board’s processes thus turns on the answer to the first criteria above, namely whether employees
could reasonably interpret or construe the ATA’s language to restrict access to the Board’s
processes.25
I conclude that given the breadth of the ATA’s initial language, which mandates
arbitration “for any claims that arise between me and Taco Bell . . . (w)ithout limitation, such
claims would include any concerning compensation, employment (SIC) including, but not
limited to, any claims of sexual harassment or discrimination, or termination of employment”30
(emphasis supplied), employees could reasonably and likely interpret or construe it to restrict
access to the Board’s processes. Respondent argues that the phrase that immediately precedes
the above-quoted language, which states “I agree to confidential arbitration, instead of going to
court, for any claims” (emphasis added) negates any unlawful inference, because going to the
Board is not the same as going to court. The Board has rejected similar arguments, however, 35
noting that typical “nonlawyer employees” do not have specialized legal knowledge to making
the fine distinction between administrative and judicial processes. 2 Sisters Food Group, Inc.,
357 NLRB No. 168 at p. 2 (2011); U-Haul Co. of California, 347 NLRB at 377–378.8 Thus, any
non-legally trained employee—which, presumably includes most employees of Taco Bell—
could reasonably conclude that the above-cited language of the ATA would preclude them from 40
seeking any legal remedy prior to submitting to arbitration, including filing charges with the
Board. The same holds true for the language on subsection (iii) of the ATA which follows the
above-quoted broad language, which states that prior to going to arbitration, the employee must

8 Indeed, the arbitration agreement found unlawful by the Board in Murphy Oil, supra, used
similar language requiring employees to use arbitration instead of suing in court.
JD(SF)–17–15
10
“complete any external administrative remedy (such as with the Equal Employment Opportunity
Commission.” This language is similar to other “savings clauses” that have been held
insufficient by the Board in light of the broader and sweeping mandatory arbitration language in
the rest of the agreement, including Murphy Oil, where the savings clause actually appeared to
permit employees to proceed to the NLRB. See, also, Bill’s Electric, Inc., 350 NLRB 292, 296 5
(2007); Cellular Sales, 362 NLRB No. 27, fn. 4. Moreover, such clause at best creates an
ambiguity which must be construed against Respondent as the ATA’s drafter. Lafayette Park
Hotel, 326 NLRB 824, 828 (1998), enfd. 203 F.3d 52 (D.C. Cir. 1999).
Accordingly, for the above reasons, I conclude that the ATA violates Section 8(a)(1) of 10
the Act by interfering with their right to access the Board’s processes.
4. Whether the ATA violates Section 8(a)(1) of the Act by requiring employees to keep any
arbitration proceedings “confidential.”15
As described above, the language of the ATA requires employees to use “confidential”
arbitration to resolve any employment-related disputes. This language explicitly commands that
any arbitration proceedings be kept confidential, which reasonably implies that employees
cannot discuss with each other the facts, circumstances, history, tactics, justification, motivation 20
or outcome regarding any arbitration proceeding they are compelled by the ATA to use in order
to vindicate their employment-related rights. The right of employees to discuss these matters
with each other lies at the very core of Section 7, which protects—and encourages—concerted
activity for their mutual aid and protection. It is well-settled that any work rules that prohibit, or
can reasonably be interpreted to prohibit, employees from discussing their wages, hours, or 25
working conditions which each other are unlawful. Fresh & Easy Neighborhood Market, 361
NLRB No. 8, slip op. at 2–3 (2014); Lily Transportation Corp., 362 NLRB No. 54, fn. 2 (2015);
Flamingo Hilton-Laughlin, 330 NLRB 287 (1999).
Accordingly, I conclude that by maintaining an arbitration policy, which I have 30
previously concluded was a mandatory condition of employment, that requires that any
arbitration used by employees be kept confidential, Respondent violated Section 8(a)(1) of
the Act.
CONCLUSIONS OF LAW35
1. Respondent at all times material herein has been an employer engaged in commerce
within the meaning of Section 2(2), (6), and (7) of the Act.
2. Respondent violated Section 8(a)(1) of the Act by maintaining and enforcing a 40
mandatory arbitration agreement that mandates individual arbitration and precludes class actions
by employees for wage and hour claims or other employment-related claims in any forum,
arbitral or judicial.
JD(SF)–17–15
11
3. Respondent violated Section 8(a)(1) of the Act by filing a Motion to Compel
Arbitration on an Individual Basis in California Superior Court in case No. BC513815 on or
about October 24, 2013.
4. Respondent violated Section 8(a)(1) of the Act by maintaining and enforcing a 5
mandatory arbitration agreement that employees could reasonably construe to preclude filing of
charges with the Board.
5. Respondent violated Section 8(a)(1) of the Act by maintaining and enforcing a
mandatory arbitration agreement that requires employees to keep any arbitration confidential.10
REMEDY
Having found that Respondent has engaged in certain unfair labor practices, I shall order
it to cease and desist and to take certain affirmative action designed to effectuate the policies of 15
the Act.
As I have concluded that the Agreement to Arbitrate (ATA) is unlawful, Respondent
must revise or rescind the ATA and advise their employees in writing that the ATA has been
revised or rescinded. Further, Respondent shall post notices in all locations where the ATA was 20
in effect informing employees of the revision or rescission of the ATA, and shall provide said
employees with a copy of any revised. Any revision should clarify that such agreement does not
bar or restrict employees from seeking class wage and hour actions or any other type of class
employment-related actions in any forum, and specifically does not bar or restrict employees
from filing charges with the NLRB. Additionally, any such revised agreement shall inform 25
employees that they are not barred or restricted from communicating or discussing with each
other any matters regarding their wages, hours or working conditions, including any such matters
covered by arbitration.
Respondent shall further be ordered to notify the State Court in Case No. BC513815 that 30
it no longer opposes the plaintiff’s claims on the basis of the ATA, which has been rescinded or
revised because it was found unlawful, and to move the court to vacate its order compelling
individual arbitration on the basis of the ATA.9 Respondent shall also be ordered to reimburse
Charging Party Lujan for all reasonable expenses and legal fees, with interest, incurred in
opposing Respondent’s unlawful petition to compel individual arbitration in a collective action. 35
Interest shall be computed as prescribed in New Horizons, 283 NLRB 1173 (1987), compounded
daily as prescribed in Kentucky River Medical Center, 356 NLRB No. 8 (2010).

9 Pursuant to the Board’s D.R. Horton and Murphy Oil rulings, Respondent is free to oppose
class certification on any basis other that an unlawful arbitration agreement compelling
employees to arbitrate employment disputes on an individual basis. As the Board observed,
employees have Section 7 rights to seek class actions, not to have such class actions approved.
JD(SF)–17–15
12
Upon the forgoing findings of fact and conclusions of law, and upon the entire record,
I issue the following recommended.10
ORDER
5
Respondent, Century Fast Foods, Inc., a corporation with an office and principal place of
business in Chatsworth, California, its officers, agents, successors, and assigns, shall
1. Cease and desist from
10
(a) Maintaining a mandatory and binding arbitration agreement that require
employees, as a condition of employment, to waive their right to pursue class or collective
claims in all forums, whether arbitral or judicial.
(b) Maintaining a mandatory and binding arbitration agreement that employees would15
reasonably believe bars or restricts employees’ rights to file unfair labor practice charges with
the National Labor Relations Board or to access the Board’s processes.
(c) Maintaining a mandatory and binding arbitration agreement that requires
employees to keep confidential any arbitration proceedings undertaken as the result of such 20
agreement.
(d) Filing a petition to enforce its Agreement to Arbitrate to thereby compel
individual arbitration and preclude employees from pursuing employment-related disputes with
the Respondent on a class or collective basis in any forum.25
(e) In any like or related manner interfering with, restraining, or coercing employees
in the exercise of the rights guaranteed them by Section 7 of the Act.
2. Take the following affirmative action necessary to effectuate the policies of the Act.30
(a) Rescind the mandatory and binding arbitration agreements in all of its forms, or
revise them in all of its forms to make clear to employees that the arbitration agreement does not
constitute a waiver of their right to maintain employment-related joint, class, or collective
actions in all forums, whether arbitral or judicial; that they do not restrict employees’ right to file 35
charges with the National Labor Relations Board or to access the Board’s processes; and that
they do not restrict employees’ right to discuss arbitration proceedings with each other.
(b) Notify all current and former employees who were required to sign the arbitration
agreement in any form that they have been rescinded or revised and, if revised, provide them a40
copy of the revised agreement.

10 If no exceptions are filed as provided by Sec. 102.46 of the Board’s Rules and
Regulations, the findings, conclusions and recommended Order shall, as provided in Sec. 102.48
of the Rules, be adopted by the Board and all objections to them shall be deemed waived for all
purposes.
JD(SF)–17–15
13
(c) Within 14 days after service by the Region, notify the Superior Court of the State
of California in Case No. BC513815 that it has rescinded or revised the mandatory arbitration
agreement upon which it based, its motion to dismiss William Lujan’s collective action and to
compel individual arbitration of his claim, and inform the court that it no longer opposes the5
action on the basis of the arbitration agreement.
(d) In the manner set forth in this decision, reimburse William Lujan for any
reasonable attorneys’ fees and litigation expenses that he may have incurred in opposing
Respondent’s petition to dismiss the wage claim and compel individual arbitration.10
(e) Within 14 days after service by the Region, post at all its locations in California
where notices to employees are customarily posted, copies of the attached notice marked
“Appendix.” 11 Copies of the notice, on forms provided by the Regional Director for Region 31,
after being signed by the Respondent’s authorized representative, shall be posted by the15
Respondent and maintained for 60 consecutive days in conspicuous places including all places
where notices to employees are customarily posted. In addition to physical posting of paper
notices, the notices shall be distributed electronically, such as by email, posting on an intranet or
an internet site, and/or other electronic means, if the Respondent customarily communicates with
its employees by such means. Reasonable steps shall be taken by the Respondent to ensure that 20
the notices are not altered, defaced, or covered by any other material. In the event that, during the
pendency of these proceedings, the Respondent has gone out of business or closed the facilities
involved in these proceedings, the Respondent shall duplicate and mail, at its own expense, a
copy of the notice to all current employees and former employees employed by the Respondent
at any time since October 22, 2012.25
(f) Within 21 days after service by the Region, file with the Regional Director for
Region 31, a sworn certification of a responsible official on a form provided by the Region
attesting to the steps that the Respondent has taken to comply.
30
Dated: Washington, D.C. April 24, 2015
Ariel L. Sotolongo
Administrative Law Judge35

11 If this Order is enforced by a judgment of the United States court of appeals, the words in
the notice reading “Posted by Order of the National Labor Relations Board” shall read “Posted
Pursuant to a Judgment of the United States Court of Appeals Enforcing an Order of the National
Labor Relations Board.”
APPENDIX
NOTICE TO EMPLOYEES
Posted by Order of the
National Labor Relations Board
An Agency of the United States Government
The National Labor Relations Board has found that we violated the National Labor Relations Act
and has ordered us to post and abide by this notice.
FEDERAL LAW GIVES YOU THE RIGHT TO
Form, join, or assist a union
Choose representatives to bargain with us on your behalf
Act together with other employees for your benefits and protection
Choose not to engage in any of these protected activities
WE WILL NOT maintain a mandatory and binding arbitration agreement that our employees
reasonably would believe bars or restricts their right to file charges with the National Labor
Relations Board or to access the Board’s processes.
WE WILL NOT maintain and/or enforce a mandatory and binding arbitration agreement that
requires our employees, as a condition of employment, to waive the right to maintain class or
collective actions in all forums, whether arbitral or judicial.
WE WILL NOT maintain and/or enforce an arbitration agreement that prohibits employees from
discussing arbitration proceedings with each other.
WE WILL NOT in any like or related manner interfere with, restrain, or coerce you in the
exercise of the rights listed above.
WE WILL rescind the mandatory and binding Arbitration Agreement in all of its forms, or revise
it in all of its forms to make clear that the arbitration agreement does not constitute a waiver of
your right to maintain employment-related joint, class, or collective actions in all forums; that it
does not restrict your right to file charges with the National Labor Relations Board or to access
the Board’s processes; and does not prohibit you from discussing arbitrations with each other.
WE WILL notify all current and former employees who were required to sign the mandatory
Agreement to Arbitrate in all of its forms that the arbitration agreement has been rescinded or
revised and, if revised, provide them a copy of the revised agreement.
WE WILL notify the court in which William Lujan filed his collective wage claim that we have
rescinded or revised the mandatory Agreement to Arbitrate upon which we based our petition to
dismiss his collective wage claim and compel individual arbitration, and
WE WILL inform the court that we no longer oppose William Lujan’s collective claim on the
basis of that agreement.
WE WILL reimburse William Lujan for any reasonable attorneys’ fees and litigation expenses
that he may have incurred in opposing our motion to dismiss his collective wage claim and
compel individual arbitration.
Century Fast Foods Inc.
__________________________________
(Employer)
Dated_______________ By __________________________
(Representative) (Title)
The National Labor Relations Board is an independent Federal agency created in 1935 to enforce the National Labor
Relations Act. It conducts secret-ballot elections to determine whether employees want union representation and it
investigates and remedies unfair labor practices by employers and unions. To find out more about your rights under
the Act and how to file a charge or election petition, you may speak confidentially to any agent with the Board’s
Regional Office set forth below. You may also obtain information from the Board’s website: www.nlrb.gov.
11500 West Olympic Boulevard, Suite 600
Los Angeles, California 90064-1824
Hours: 8:30 a.m. to 5 p.m.
310-235-7352
The Administrative Law Judge’s decision can be found at www.nlrb.gov/case/31-CA-116102 or by using the QR code
below. Alternatively, you can obtain a copy of the decision from the Executive Secretary, National Labor Relations Board,
1099 14th Street, N.W., Washington, D.C. 20570, or by calling (202) 273-1940.
THIS IS AN OFFICIAL NOTICE AND MUST NOT BE DEFACED BY ANYONE
THIS NOTICE MUST REMAIN POSTED FOR 60 CONSECUTIVE DAYS FROM THE DATE OF POSTING AND MUST
NOT BE ALTERED, DEFACED, OR COVERED BY ANY OTHER MATERIAL. ANY QUESTIONS CONCERNING THIS
NOTICE OR COMPLIANCE WITH ITS PROVISIONS MAY BE DIRECTED TO THE ABOVE REGIONAL OFFICE’S
COMPLIANCE OFFICER, 310-235-7123.