California Court of Appeal Curbs “I Do Not Recall Signing” Defense to Arbitration Agreements
Employers face many challenges when enforcing employment arbitration agreements, including employees disavowing their handwritten signature on the arbitration agreement, claiming that they do not recall signing it. However, the California Court of Appeal recently issued a pro-employer decision that shot down this argument and provided further clarification as to how employers can improve their odds of enforcing such agreements when an employee attempts to use the “I do not recall signing” defense.
With increasing regularity, employees attempt to skirt arbitration agreements by relying on what essentially boils down to the “I do not recall signing the agreement” defense. Despite the arbitration agreement containing their handwritten signature, employees often assert, in opposing declarations, that they do not recall signing the arbitration agreement, and then assert in their opposition brief that their signature was not properly authenticated.
In the recent Iyere v. Wise Auto Grp. decision, the California Court of Appeal provided clarity on this reoccurring issue. The plaintiffs in Iyere began working for Wise Auto Group (Wise) on separate dates in 2018 and 2019. Wise fired plaintiffs in 2019.
In 2021, plaintiffs filed a joint complaint against their former employer. Wise moved to compel arbitration relying on binding arbitration agreements containing the employees’ handwritten signatures. Plaintiffs each submitted declarations that they received a large stack of documents on their first day of work and had to sign the documents quickly, specifically asserting that they “do not recall ever reading or signing” the arbitration agreements. The trial court denied Wise’s motion, finding that Wise failed to bear its burden of proving the authenticity of the signatures.
Wise timely appealed the order. The California Court of Appeal reversed the decision by focusing on plaintiffs’ failure to provide any admissible evidence supporting their position that the signatures were inauthentic. The Court noted that plaintiffs did not squarely deny that the handwritten signatures were not theirs. The Court concluded that absent evidence that their signatures were forged or otherwise inauthentic, plaintiffs failed to show that the arbitration agreements were unenforceable. In contrast, Wise provided a declaration from its HR Director who attested that the document attached to his declaration was a true and correct copy of the arbitration agreement.
Notably, the Court disagreed with a comparison between this case and two prior cases involving electronic signatures, stating that while handwritten and electronic signatures, once authenticated, have the same legal effect, there is a “considerable difference between the evidence needed to authenticate the two.” The Court further explained that authenticating an electronic signature “if challenged can be quite daunting,” as an “individual cannot affirm or disavow an electronic signature from the face of a computer printout, but an individual normally can recognize or disavow a handwritten signature that purports to be his or her own.”
Impact on Employers
This Court of Appeal decision signals that employers may improve their odds of enforcing arbitration agreements even when employees attempt to dodge arbitration by disavowing their handwritten signatures. However, employers should be wary of the different standard applied to evidence authenticating a handwritten signature versus an electronic one. Employers who do not have their employees provide handwritten signatures should ensure that their e-signature procedure is secure and that, if necessary, can demonstrate the security of that procedure with admissible evidence.