Filed 6/29/26 Forney v. CHCM CA4/3
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IN THE COURT OF APPEAL OF THE STATE OF CALIFORNIA
FOURTH APPELLATE DISTRICT
DIVISION THREE
LAUREN FORNEY,
Plaintiff and Appellant, G065550
v. (Super. Ct. No. 30-2021-
01229774)
CHCM, INC.,
OPINION
Defendant and Respondent.
Appeal from an order of the Superior Court of Orange County,
William D. Claster, Judge. Affirmed.
Shanberg Stafford, Ross E. Shanberg and Shane C. Stafford;
Bartz Law Group and Aaron A. Bartz for Plaintiff and Appellant.
Ballard Rosenberg Golper & Savitt, David Fishman, John J.
Manier and Janet S. Soultanian for Defendant and Respondent.
* * *
Plaintiff Lauren Forney appeals the trial court’s order confirming
an arbitration award in favor of defendant CHCM, Inc., doing business as
College Hospital Costa Mesa (CHCM). Forney also appeals from the court’s
denial of her motion to vacate the award. She contends the arbitrator
exceeded his powers by manifestly disregarding California law and issuing a
ruling that conflicted with established California policy.
We disagree and find no actual error. The arbitrator’s decision
constituted a reasonable interpretation of the relevant law. Accordingly, the
trial court’s decision to confirm and not vacate the arbitration decision was
not error. We affirm the order.
STATEMENT OF FACTS AND PROCEDURAL HISTORY
Forney has been a licensed registered nurse since January 2019.
In April 2019, she began working as a staff nurse for CHCM. She was later
promoted to charge nurse.
When Forney began her employment, she signed an agreement
entitled “Employee Agreement to Arbitrate” (Arbitration Agreement or
Agreement), which, among other things, acknowledged that she had received
and read CHCM’s arbitration policy. The Agreement stated it “shall be
governed solely by the Federal Arbitration Act” (9 U.S.C. § 1 et seq.) (FAA),
and that “[p]rocedural issues shall be governed by the FAA.”
During her employment, Forney was classified as a nonexempt
employee. Forney left CHCM in 2021.
On November 4, 2021, Forney filed her initial complaint in the
trial court. She filed an amended complaint on January 31, 2022 (the
complaint) which alleged a single cause of action under the Private Attorneys
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General Act (Lab. Code, § 2698 et seq.)1 (PAGA). She alleged violations of the
Labor Code, including, as relevant here, meal period violations (§ 512).
Forney claimed she and other aggrieved employees were not given the
opportunity to take proper meal periods before the end of the fifth hour of
work, or to take a second meal period when they worked more than 10 hours
a day.
In October 2022, CHCM filed a motion to compel individual
arbitration and dismiss claims. The court granted the motion to compel
individual arbitration and stayed the remaining claims under PAGA until the
arbitration was completed.
Forney submitted an arbitration claim, alleging numerous wage
and hour violations. Among other things, Forney alleged that CHCM failed to
pay overtime, provide meal periods, provide rest periods, and timely pay
wages. She sought unpaid wages and penalties under PAGA, as well as
attorney fees and restitution.
Forney testified during the arbitration. After she was hired at
CHCM, she attended an orientation during which she was given onboarding
documents to review and sign. This was Forney’s first job at which she was
asked to work shifts of 12 hours, and she asked questions about a document
which included a waiver of a second meal period. To her understanding, it
was explained that waiving the second meal period would shorten her shift
from 12 hours and 30 minutes to 12 hours.
The document Forney signed was called “Agreement to Waive
Right to a Second Meal Period.” Above the title, “College Hospital Costa
Mesa” was printed. The document stated: “I, Lauren Forney of the Nursing
1 Subsequent statutory references are to the Labor Code unless
otherwise indicated.
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department, request to waive one of the two thirty (30) minute meal periods
to which I am entitled on days in which I work ten (10) hours or more but not
more than twelve (12) hours. When practicable, my daily thirty (30) minute
meal period will be scheduled towards the middle of my shift. [¶] I may
revoke this waiver at any time by providing my supervisor with at least one
day’s written notice. This agreement is entered into freely and voluntarily.”
Forney’s signature appears on the document, as does a blank space for the
human resources director.
The arbitration lasted multiple days. After it concluded, the
arbitrator, in due course, issued a final award. The arbitrator found in favor
of CHCM. With regard to the issues pertinent to this appeal, the arbitrator
found that nurses were permitted to waive a meal period during the first five
hours of their shift. Forney contended she was only allowed by law to waive a
second meal period, but not the first. The arbitrator disagreed, finding the
relevant wage order expressly allowed healthcare workers who work more
than eight hours per shift to “voluntarily waive their right to one of their two
meal periods.”
The arbitrator also determined Forney’s written waiver was
enforceable despite the lack of a signature by CHCM. The arbitrator found
the printed words “College Hospital Costa Mesa” and “Human Resources
Director” were sufficient.
CHCM subsequently filed a petition to confirm the award in the
trial court. Forney filed a petition to vacate the award. The court heard the
motions on the same date. Following the hearing, the court granted the
motion to confirm and denied the motion to vacate. Forney now appeals.
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DISCUSSION
I.
STATUTORY FRAMEWORK AND STANDARD OF REVIEW
Under the agreement’s terms, the Federal Arbitration Act (9
U.S.C. §1 et seq.; FAA) applies to this case. While California courts do not
generally apply the FAA’s vacatur provisions, “the parties have
unambiguously agreed to enforcement of the awards under the Federal
Arbitration Act and we enforce their choice of law determination.”
(Countrywide Financial Corp. v. Bundy (2010) 187 Cal.App.4th 234, 247.)
The statutory grounds for vacating an arbitration award under
the FAA are narrow and exclusive. (See Hall Street Associates, L.L.C. v.
Mattel, Inc. (2008) 552 U.S. 576, 584–589.) “Factual or legal errors by
arbitrators—even clear or gross errors—‘do not authorize courts to annul
awards.’” (Gingiss International, Inc. v. Bormet (7th Cir. 1995) 58 F.3d 328,
333.) Nor is insufficiency of the evidence grounds for overturning an award
under the FAA. (Flexible Manufacturing Systems Pty. Ltd. v. Super Products
Corporation (7th Cir. 1996) 86 F.3d 96, 99–100.)
One provision that permits vacatur of an arbitration award is
“where the arbitrators exceeded their powers.” (9 U.S.C. § 10(a)(4).) In order
to obtain relief under this provision, the appellant “must clear a high hurdle.”
(Stolt-Nielsen S.A. v. AnimalFeeds International Corp. (2010) 559 U.S. 662,
671.) “‘It is only when [an] arbitrator strays from interpretation and
application of the agreement and effectively “dispense[s] his own brand of
industrial justice” that his decision may be unenforceable.’” (Ibid.)
An arbitrator’s decision may be subject to vacatur under this
provision if it is “‘“completely irrational” or “constitutes manifest disregard of
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the law.”’”2 (Comedy Club, Inc. v. Improv West Associates (9th Cir. 2009) 553
F.3d 1277, 1288.) “[F]or an arbitrator’s award to be in manifest disregard of
the law, ‘[i]t must be clear from the record that the arbitrator[] recognized the
applicable law and then ignored it.’” (Id. at p. 1290.)
An arbitrator may also exceed his or her powers if the award is
contrary to public policy. (Ling v. P.F. Chang’s China Bistro, Inc. (2016) 245
Cal.App.4th 1242, 1258, disapproved of on other grounds by Naranjo v.
Spectrum Security Services, Inc. (2022) 13 Cal.5th 93, 117.) This provision is
narrow and “limited to situations where the contract as interpreted would
violate ‘some explicit public policy’ that is ‘well defined and dominant, and is
to be ascertained “by reference to the laws and legal precedents and not from
general considerations of supposed public interests.”’” (United Paperworkers
International Union, AFL-CIO v. Misco, Inc. (1987) 484 U.S. 29, 43.)
“We review de novo a district court’s decision to confirm or vacate
an arbitration award.” (Fidelity Federal Bank, FSB v. Durga Ma Corporation
(9th Cir. 2004) 386 F.3d 1306, 1311.) In doing so, however, we bear in mind
the very narrow grounds for challenging the arbitrator’s decision.
2 Whether “manifest disregard” is a valid basis for vacatur is a subject
of disagreement. It is not of critical importance here. (See Countrywide
Financial Corp. v. Bundy, supra, 187 Cal.App.4th at pp. 250–253; Comedy
Club, Inc. v. Improv West Associates, supra, 553 F.3d at pp. 1289–1290.)
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II.
COVERED EMPLOYEES MAY WAIVE ONE OF TWO MEAL PERIODS
Forney contends the arbitrator exceeded his powers and
manifestly disregarded the law by finding she was able to waive a “first meal
period” when working more than eight hours per day.
Wage and hour laws, including meal breaks, are “governed by
two complementary and occasionally overlapping sources of authority: the
provisions of the Labor Code, enacted by the Legislature, and a series of 18
wage orders, adopted by the [Industrial Welfare Commission (IWC)].”
(Brinker Restaurant Corp. v. Superior Court (2012) 53 Cal.4th 1004, 1026.)
We begin with the relevant Labor Code provisions. Section 512,
subdivision (a), states that “an employer shall not employ an employee for a
work period of more than five hours per day without providing the employee
with a meal period of not less than 30 minutes, except that if the total work
period per day of the employee is no more than six hours, the meal period
may be waived by mutual consent of both the employer and employee. An
employer shall not employ an employee for a work period of more than 10
hours per day without providing the employee with a second meal period of
not less than 30 minutes, except that if the total hours worked is no more
than 12 hours, the second meal period may be waived by mutual consent of
the employer and the employee only if the first meal period was not waived.”
In sum, an employee who works more than five hours must be
provided a 30 minute meal break. Employees who work more than 10 hours
must be provided a second meal break. The second meal break may be waived
with both parties consent “only if the first meal period was not waived.”
Section 516, subdivision (a) permits the IWC to adopt or amend
working condition orders “with respect to break periods, meal periods, and
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days of rest” except “as provided by Section 512.” Accordingly, this section
prohibited the IWC from altering the rule that a worker must be given a meal
period within the first five hours of work.
In 2015, the Legislature amended section 516. It added a
subdivision (b) to take effect immediately. (Stats. 2015, ch. 506, § 2,
eff. Oct. 5, 2015.) The new subdivision (b) stated: “Notwithstanding
subdivision (a), or any other law, including Section 512, the health care
employee meal period waiver provisions in Section 11(D) of Industrial
Welfare Commission Wage Orders 4 and 5 were valid and enforceable on and
after October 1, 2000, and continue to be valid and enforceable.” (§ 516, subd.
(b).)
It is IWC’s wage order No. 5-2001 (Wage Order No. 5) that is
relevant here. It first states the general rule as codified in section 512,
subdivision (a). (Wage Order No. 5, § 11(A).) It then modifies that rule for
healthcare workers who work shifts longer than eight hours:
“Notwithstanding any other provision of this order, employees in the health
care industry who work shifts in excess of eight (8) total hours in a workday
may voluntarily waive their right to one of their two meal periods. In order to
be valid, any such waiver must be documented in a written agreement that is
voluntarily signed by both the employee and the employer. The employee
may revoke the waiver at any time by providing the employer at least one
day’s written notice. The employee shall be fully compensated for all working
time, including any on-the-job meal period, while such a waiver is in effect.”
(Wage Order No. 5, § 11(D), italics added.)
Similar language first appeared in amendments to Wage Order
No. 5 from 1993. At that time, covered employees were permitted to “waive
their right to a meal period.” (Wage Order No. 5 (1993) § 11(C), italics added.)
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The IWC explained its reasoning: “The petitioner requested the IWC to allow
employees in the health care industry who work s[h]ifts in excess of eight (8)
total hours in a workday to waive their right to ‘any’ meal period or meal
periods as long as certain protective conditions were met. The vast majority
of employees testifying at public hearings supported the IWC’s proposal with
respect to such a waiver, but only insofar as waiving ‘a’ meal period or ‘one’
meal period, not ‘any’ meal period. Since the waiver of one meal period allows
employees freedom of choice combined with the protection of at least one
meal period on a long shift, on June 29 1993, the IWC adopted language
which permits employees waive a second meal period provided the waiver is
documented in a written agreement voluntarily signed by both the employee
and the employer, and the waiver is revocable by the employee at any time by
providing the employer at least one day’s notice.” (IWC Statement as to the
Basis for Wage Order No. 5 (1993) § 11(C); see Gerard v. Orange Coast
Memorial Medical Center (2018) 6 Cal.5th 443, 448; Bradsbery v. Vicar
Operating, Inc. (2025) 110 Cal.App.5th 899, 913.)
This language clarifies that the order allows employees to waive
“a” or “one” meal period. When the IWC refers to “a second meal period,” it is
not referring to a meal period after the first one, but “a” second meal period,
meaning either of the two. The language was later refined to the current
version of “‘one of their two meal periods.’” (Gerard v. Orange Coast Memorial
Medical Center, supra, 6 Cal.5th at p. 449.)
Forney wants us to interpret “a second meal period” to mean the
later of two meal periods. But there is simply no law supporting this
interpretation. The current version of Wage Order No. 5 is clear on its face,
referring to “one of [the employee’s] two meal periods.” The evolution of the
language in the Wage Order, not that we need resort to it when the language
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itself is clear, also supports this interpretation. The waiver Forney signed
mirrors the language of the Wage Order, stating she requested “to waive one
of the two” meal periods to which she was entitled. Contrary to Forney’s
arguments, she properly waived one of her two meal periods, and she offers
no authority3 finding a similar waiver unlawful.
To reach the outcome Forney desires would require us to ignore
section 516 and the unequivocal language of the Wage Order itself. The Wage
Order is the controlling meal period regulation under section 516, and the
arbitrator correctly applied it here. Accordingly, we find the arbitrator did not
exceed his authority.
III.
THE PRINTED SIGNATURE DOES NOT REQUIRE VACATUR
A waiver of one of an employee’s two meal periods “must be
documented in a written agreement that is voluntarily signed by both the
employee and the employer.” (Wage Order No. 5, § 11(D).) Here, the waiver
included a printed heading that stated, “College Hospital Costa Mesa” and
included a line at the end for “Human Resources Director.” It did not include
a cursive signature.
The arbitrator found the waiver agreement valid, because
“CHCM intended its letterhead and typed position ‘Human Resources
Director’ to authenticate its name as its signature.” The arbitrator reasoned
the statute of frauds did not apply, and parol evidence may authenticate the
letterhead and typed signature line as the hospital’s signature. The court
3 Forney relies heavily on Gerard v. Orange Coast Memorial Medical
Center, supra, 6 Cal.5th 443. But Gerard only considered waiver of the
“second meal period,” and is not authority for a point it did not reach. (Id. at
pp. 446–447.)
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considered Lara v. Onsite Health, Inc. (N.D. Cal. 2012) 896 F.Supp.2d 831,
which considered whether an arbitration agreement was mutual when the
employer had not signed it. The arbitrator explained: “The court held the
defendant company intended to be bound by the agreement because, inter
alia, defendant’s ‘intent is evidenced by the fact that the Agreement is
printed on its company letterhead and, because [defendant] submitted its
offer of employment in this manner, . . . [defendant] intended to authenticate
its name as a signature. . . . [Defendant’s] intent to be bound is further
evidenced by the fact that it presented the Agreement to [plaintiff] as part of
its New Hire packet, with a letter explaining that [plaintiff] must complete
and sign all documents to be processed. . . . [T]he Court finds that [defendant]
intended to be bound by the Agreement and that its letterhead was intended
to authenticate the Agreement.’”
The arbitrator found the evidence established CHCM intended to
authenticate its name as a signature, relying on Forney’s testimony that she
reviewed and signed new hire documents, including the waiver. She was
required to do so in order to work there. As in Lara, the evidence of the
agreement, signed by Forney at her orientation, indicated CHCM’s intent “to
authenticate its name as its signature.”
Mindful of the standard of review here, we find no basis to
overturn the arbitrator’s determination that the waiver agreement was valid
despite the lack of a written signature by CHCM. As we noted above,
“‘[A]rbitrators exceed their powers . . . not when they merely interpret or
apply the governing law incorrectly, but when the award is completely
irrational, or exhibits a manifest disregard of law.’” (Schoenduve Corp. v.
Lucent Technologies, Inc. (9th Cir. 2006) 442 F.3d 727, 731.) While reasonable
minds could perhaps differ, the arbitrator’s decision is based on a fair
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interpretation of case law and the relevant facts, and is neither irrational nor
demonstrates “‘a manifest disregard of the law.’” (Ibid.)
Accordingly, we find no error.
DISPOSITION
The order is affirmed. CHCM is entitled to its costs on appeal.
MOORE, ACTING P. J.
WE CONCUR:
GOODING, J.
SERVINO, J.
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