Is an arbitration agreement enforceable on a "take-it or leave-it" basis?

California, United States of America


The following excerpt is from Pichardo v. Am. Fin. Network, G054755 (Cal. App. 2019):

4. "Adhesive contracts are those where a party of superior bargaining strength drafts the contract and imposes its terms in a take-it or leave-it manner." (Fitz v. NCR Corp. (2004) 118 Cal.App.4th 702, 713.) On the one hand, defendant's chief compliance officer and Associate General Counsel states in his declaration that "[e]mployees are not required to sign the arbitration agreement to gain employment" and that "on occasion, an employee will refuse it" (though it is unclear from his declaration that he had personal knowledge in this regard). On the other hand, the Arbitration Agreement was drafted by defendant, which presumably had superior bargaining power over plaintiff. Further, plaintiff claims he "was only instructed that [he] was required to fill out and sign the stack of documents and forms presented to [him] before [he] could start work," and that he did not reach a final agreement with defendant about his compensation until "after [he] finished filling out each of the documents and forms," suggesting that the agreement was given to him on a take-it-or-leave-it basis. (Italics added.)

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