An employer’s arbitration agreement bars class actions, so the plaintiffs’ firm files 300 individual demands instead. Every demand carries its own filing fee, and under most employer-drafted agreements the employer pays it. Under the American Arbitration Association’s Mass Arbitration Supplementary Rules, the special procedures start at “twenty-five or more Consumer or Employment/Workplace similar Demands.” In California, a missed invoice can cost the employer the right to arbitrate at all. The defense starts with the paperwork, not the merits.
What is a mass arbitration?
It’s a coordinated filing of many individual arbitration demands against one employer, usually by one law firm, over the same pay practice or policy.
The AAA’s rules define it as 25 or more similar employment or consumer demands “filed against or on behalf of the same party or related parties,” where “representation of all parties is consistent or coordinated across the cases.” The rules apply “whether or not such cases are filed simultaneously,” so a firm can’t avoid them by filing in waves.
Each demand is still its own case. Rule MA-2 says “A separate Demand for Arbitration must be filed in each individual case.” The supplementary rules simplify administration, but they don’t turn the filings into a class action. That’s the point from the claimants’ side. The employer bargained for individual arbitration, and individual arbitration is what it gets, hundreds of times over.
Why does a mass filing put so much pressure on the employer?
Because the fees arrive before anyone looks at the merits, and California punishes late payment.
Under employer-drafted agreements, the employer usually pays the arbitration provider’s fees and the arbitrator’s compensation. Multiply a per-case filing fee by several hundred claimants and the bill can exceed what a reasonable settlement of every claim would cost. The AAA’s rules add that “Neither settlement nor withdrawal of any individual claim or group of multiple cases shall result in extension of payment due dates or waiver of administrative fees.”
The California deadline makes the math worse. Code of Civil Procedure section 1281.97 provides that if the fees to start an employment arbitration “are not paid within 30 days after the due date the drafting party is in material breach of the arbitration agreement, is in default of the arbitration, and waives its right to compel arbitration.” The employee can then take the claim to court, and section 1281.99 requires the court to order the employer “to pay the reasonable expenses, including attorney’s fees and costs, incurred by the employee” because of the breach.
The Supreme Court of California softened that rule in 2025, holding that an honest mistake in payment doesn’t automatically forfeit the right to arbitrate. The firm’s post on late arbitration fees after Hohenshelt covers that decision. A good-faith mistake defense is still a fight no employer wants, and in a mass filing it may have to be fought claim by claim.
Can the employer challenge the demands before paying?
Sometimes, and the AAA rules build in a way to do it.
The supplementary rules create a “Process Arbitrator” to decide threshold disputes across the whole group. Under Rule MA-6, the Process Arbitrator can decide “Whether the parties have met the AAA-ICDR’s filing requirements or the filing requirements in the parties’ contract,” disputes over “any applicable conditions precedent,” fee disputes, and “Which Demands for Arbitration should be included as part of the mass arbitration filing.” There’s a catch. The rules allow appointment only “After all parties have paid the Initiation Fees,” so the challenge comes after the first payment, not instead of it.
Those threshold questions matter more than they look. Mass filings are often assembled quickly from sign-up forms, and some claimants never signed the agreement or already released their claims in an earlier settlement. Rule MA-2 requires each filing to include “an affirmation that the information provided for each individual case is true and correct to the best of the representative’s knowledge,” along with a data spreadsheet that must be provided to the opposing party. That spreadsheet is the employer’s first chance to match names against HR records.
Court is the other route. Rule MA-1(e) says that if a party “seeks judicial intervention” within 30 days after the AAA begins administration and documents it, “the AAA-ICDR will suspend administration of such cases for 60 calendar days to permit the party to obtain a stay of arbitration from the court.” That window is short. Counsel should know on day one whether a court challenge is realistic.
| Pressure point | Source | Defense response |
|---|---|---|
| 25 or more similar demands | AAA Rule MA-1(b) | Confirm each claimant signed the agreement and actually worked for the company |
| Fees due on every demand | AAA Rule MA-10; CCP § 1281.97 | Calendar every invoice and pay on time while contesting deficient demands |
| Late payment | CCP §§ 1281.97, 1281.99 | Document any payment problem at once and get counsel involved |
| Defective or duplicate filings | AAA Rules MA-2 and MA-6 | Raise filing-requirement and condition-precedent disputes with the Process Arbitrator |
| Plan to go to court | AAA Rule MA-1(e) | Seek judicial intervention within 30 days of administration |
Should employers rewrite their agreements to stop mass arbitration?
Carefully. Some anti-mass-arbitration clauses have backfired.
The Ninth Circuit’s decision in Heckman v. Live Nation Entertainment, Inc. (9th Cir. 2024) 120 F.4th 670 is the cautionary case. It was a consumer case, but the reasoning applies to any California arbitration agreement. Ticketmaster’s terms sent mass claims to a provider whose rules picked bellwether cases and made the results binding on the rest. The court described the effect: a bellwether decision favoring the defendant “will thus be binding on non-bellwether plaintiffs, who had no chance to participate in the arbitration.” It affirmed the finding that the agreement was unconscionable and unenforceable under California law.
The lesson isn’t that employers should avoid structure. Shared scheduling and a global mediator are things the AAA rules encourage the parties to agree to. The risk comes from provisions that bind claimants to results they had no part in or strip away procedural rights. An agreement that gets thrown out leaves the employer facing the class action it was trying to avoid. Any change to an arbitration program should be reviewed against the current case law before it’s rolled out, and the firm’s guide to a motion to compel arbitration in a California employment case covers the enforceability fight itself.
Steps to take once mass arbitration demands arrive
- Put a litigation hold on the signed arbitration agreements, onboarding records, personnel and payroll data for every named claimant, and the policies the demands challenge.
- Calendar every invoice due date and the 30-day window for judicial intervention under Rule MA-1(e), and notify any employment practices liability (EPLI) carrier whose policy requires prompt notice.
- Identify which claimants are current employees, and make sure managers know that no one is to discuss the arbitration with them or take any action that could look like retaliation.
- Pull the documents that test each demand: the agreement each claimant signed (or didn’t), employment dates and work locations, and any prior releases or settlements.
- Talk to a lawyer before paying, disputing, or ignoring any invoice, and before contacting claimants or their counsel about a global resolution.
Mass arbitration rewards the side that is better organized in the first 30 days. Experienced employment defense for California businesses treats the claimant list as evidence, because matching it against the company’s own records often shrinks the filing before a single merits hearing.
FAQ
Does a mass arbitration count as a class action?
No. Claimants file separate demands, and each case is heard and decided individually. The AAA’s supplementary rules coordinate administration, such as consolidated invoices and a Process Arbitrator for threshold issues. Settlement can be negotiated globally, but each claimant’s release has to be obtained individually, which is one reason global deals in mass arbitration take careful drafting.
Can the employer refuse to pay the fees and force the claims into court?
That’s risky in California. Under Code of Civil Procedure section 1281.97, nonpayment within 30 days after the due date can waive the right to compel arbitration, and section 1281.99 requires the court to award the employee’s resulting expenses and attorney’s fees. Some employers have considered letting claims go to court on purpose, but the sanctions and fee exposure usually make that a decision for counsel, not the payroll department.
Can the employer object to claimants who never signed the agreement?
Yes. Whether a claimant signed the agreement, and whether the demand meets the agreement’s filing requirements, are threshold issues. Under the AAA’s Rule MA-6, a Process Arbitrator can decide filing-requirement disputes and which demands belong in the mass filing. The employer should match every name on the claimant spreadsheet against its HR records as soon as the spreadsheet arrives.
If your company faces a mass arbitration filing
If your company has received dozens or hundreds of arbitration demands from current or former employees, the claimant list and the invoice deadlines usually decide how expensive the next three months will be. Rosenberger + Kawabata represents employers defending employment lawsuits and claims through its business litigation practice, including claims involving mass arbitration and arbitration agreement enforcement. Contact Rosenberger + Kawabata online for a confidential consultation, or call (310) 894-6921.
Sources
The statutes are Code of Civil Procedure sections 1281.97, 1281.98, and 1281.99. The provider rules are the American Arbitration Association’s Mass Arbitration Supplementary Rules, amended and effective April 1, 2024. The decision is Heckman v. Live Nation Entertainment, Inc. (9th Cir. 2024) 120 F.4th 670.
This post is general information about California and federal employment law as of November 7, 2026. It is not legal advice, and reading it does not create an attorney-client relationship. Employment statutes, regulations, and court decisions change often, and the outcome of any claim depends on its facts. Past results do not guarantee future outcomes.