Nonprofit News
Jordan Carman
Associate | San Francisco
Hannah Dodge
Associate | San Francisco
Mieko Failey
Associate | Los Angeles
Christopher Fallon
Partner | Los Angeles
Alison R. Kalinski
Senior Counsel | Los Angeles
Gabriella Kamran
Associate | Los Angeles
Joshua Sarsfield
Associate | San Diego
Casey Williams
Partner | San Francisco
ADA Compliance
When Nonprofits Open Access To The Public: Understanding ADA Title III.
Nonprofit organizations play a critical role in their communities, often serving as a lifeline for community members who rely on access to essential services, education, cultural arts, and community support. Ensuring full access to programs and services for people with disabilities fulfills legal obligations and reinforces the values and missions that guide nonprofit work.
Nonprofit organizations regularly serve the public through publicly available programs, events, facilities, social services, and online platforms. While accessibility is often part of nonprofit values and operations, nonprofits may want to examine how the Americans with Disabilities Act of 1990, Title III, codified as 42 United States Code sections 12181 through 12189, applies to their publicly available work to ensure legal compliance.
Nonprofits should be aware of ADA Title III compliance requirements, including which ADA provisions apply to them, what legal obligations they must follow, and how those obligations extend beyond physical facilities. When an organization expands its programming, opens an event to the general public, launches a website, or receives an accessibility related inquiry from a community member or funder, it triggers ADA Title III requirements.
The following discussion outlines why ADA questions commonly arise for nonprofits and highlights key considerations organizations should evaluate when assessing their obligations under ADA Title III.
Why ADA Questions Arise For Nonprofits.
Nonprofits interact with the public through a wide range of platforms, including hosting public events, operating community-based programs, providing ongoing services through physical facilities available to the public, and providing information to the public through websites and digital tools. Although accessibility is often considered in practice, ADA Title III is a complex area of law where nonprofits might have unintentionally overlooked certain requirements.
How ADA Title III Applies To Nonprofits And Places Of Public Accommodation.
ADA Title III applies to private entities, including nonprofit organizations, that own, lease, lease to, or operate places of public accommodation. (42 U.S.C. section 12182(a); 28 C.F.R. section 36.201). A nonprofit is considered a place of public accommodation when it offers goods, services, programs, or activities to the public. (42 U.S.C. section 12181(7); 28 C.F.R. section 36.104).
Under Title III, nonprofits must provide individuals with disabilities equal access to their programs and services. This obligation may include physical access to facilities, reasonable modifications to policies and practices, and effective communication through auxiliary aids and services. (42 U.S.C. section 12182(b); 28 C.F.R. section 36.302 to 36.303).
Five Key Considerations For Nonprofits Under ADA Title III.
1. Public Access Drives Title III Applicability.
ADA Title III applies based on public access, not nonprofit mission, intent, or organizational structure. Many nonprofits assume that ADA Title III obligations are primarily directed at commercial businesses, but Title III focuses on whether services are available to the public.
For nonprofits, this can include community workshops, public performances, fundraising events open to the general public, museum or gallery access, educational programs, client services available without membership restrictions
or closed group restrictions, or public use of nonprofit facilities. When participation is open to the public, Title III obligations are often and likely triggered.
2. The Concept Of Public Accommodation Is Broader Than Expected.
The definition of a place of public accommodation is broader than many nonprofits may expect. Title III is not limited to buildings owned by the organization and can apply to programs and services offered in a variety of settings.
For example, Title III may apply when a nonprofit hosts events in rented or shared spaces, partners with other organizations to offer publicly available joint programming, operates temporary or pop-up locations in public settings, or delivers services through websites, registration platforms, or other digital tools the public can access. Title III’s applicability is connected to the accessibility of public programs or services.
3. Accessibility Obligations Go Beyond Physical Spaces.
ADA Title III obligations extend beyond ramps, parking, and building features. Policies, procedures, communication practices, and digital accessibility all play a role in determining whether people with disabilities have equal access to public nonprofit programs and services.
Examples include providing reasonable modifications to participation requirements, offering auxiliary aids such as interpreters or captioning when appropriate, ensuring online registration forms are accessible, and maintaining accessible communication methods for program information and public outreach. A nonprofit may have a physically accessible facility. However, people with disabilities may still face barriers in access to the nonprofit’s services if its policies or communication methods exclude individuals with disabilities.
4. Title III Understanding Increases Accessibility And Promotes Compliance.
Developing an early and accurate understanding of ADA Title III helps nonprofits identify accessibility barriers before they become compliance issues. When organizations understand how Title III applies to their publicly available services, they are better positioned to plan for accessibility, respond to accommodation requests, and address potential barriers proactively.
5. Understanding ADA Title III Is Essential For Nonprofit Sustainability And Funding Compliance.
Many funding sources require nonprofits to demonstrate compliance with the ADA. Grant applications often include questions about how organizations ensure equal access to programs and services and how accessibility is incorporated into operations and community-based services.
A working understanding of ADA Title III positions nonprofits to respond accurately to these questions, reduces funding-related risks, strengthens credibility with funders and partners, and builds trust with the communities they serve.
Accessibility In Support Of Public Service And Nonprofit Governance.
Confusion about ADA Title III is common, particularly for organizations whose services are open to the public or delivered through varied and evolving program models. Nonprofits’ missions are rooted in the commitment to offering critical services to communities and advancing missions that address complex social, cultural, and economic needs. Organizations that understand how ADA Title III applies to places of public accommodation reduce risk, strengthen compliance, and protect the sustainability of essential nonprofit programs.
By investing in accessibility and understanding their legal obligations, nonprofits reinforce the vital role they play in their communities and help ensure that their services remain open, welcoming, and available to people with disabilities.
Johnson Amendment
Judge Rejects Push To Allow Tax-Exempt Organizations To Endorse Political Candidates.
Four nonprofit organizations, including two churches and two religious broadcasters, filed suit challenging the “Johnson Amendment,” the portion of Internal Revenue Code section 501(c)(3) that restricts tax-exempt organizations from participating in certain political activities. In particular, the Johnson Amendment provides that organizations qualifying for tax-exempt status may not participate or intervene in political campaigns on behalf of or in opposition to candidates for public office. Violation of this restriction can result in loss of tax-exempt status and the loss of taxdeductibility for donor contributions. The plaintiffs alleged that this framework effectively forced them to self-censor and violated their First Amendment rights.
The plaintiffs sought a declaration that the Johnson Amendment is unconstitutional and an injunction preventing the IRS from enforcing it. The government ultimately agreed to a narrower interpretation of the Johnson Amendment as applied to the plaintiff churches. Specifically, the IRS took the position that internal communications by a house of worship to its congregation, made in good faith through customary religious channels and in connection with religious services, do not constitute participation or intervention in a political campaign within the meaning of the statute. The parties jointly sought to have this interpretation memorialized in a consent judgment, which is a court-approved settlement entered as a binding judgment.
In ruling on whether to agree to this proposed consent judgment, the Court first examined whether it had jurisdiction to grant such relief.
The Court held that it lacked jurisdiction under the Anti-Injunction Act (AIA) and the tax exception to the Declaratory Judgment Act (DJA), which prohibit federal courts from issuing orders that would preemptively restrain the assessment or collection of taxes or declare rights with respect to federal taxes, respectively. The Court explained that the Johnson Amendment operates as a condition of receiving tax benefits, namely, income tax-exempt status for the nonprofit and deductible contributions for donors, and that enjoining its enforcement would directly affect how taxes are assessed. Even though the plaintiffs framed their claims in constitutional terms, the Court emphasized that the requested relief would still interfere with tax administration and therefore fell within these jurisdictional bars.
The Court also rejected the parties’ attempt to resolve the case through a consent judgment, explaining that subjectmatter jurisdiction (i.e., the court’s authority to hear a certain type of case) cannot be created by agreement. Because the jurisdictional limitations are statutory and mandatory, the Court could not approve a settlement that it otherwise lacked authority to enter.
Finally, the Court declined to apply a narrow judicially created exception that sometimes permits pre-enforcement challenges to tax laws. To qualify for that exception, a plaintiff must both show that (1) under no circumstances could the government possibly prevail on the merits, and (2) the irreparable harm would occur absent an injunction because the plaintiff lacks any adequate alternative remedy. The Court found that neither requirement was satisfied. It explained that the plaintiffs’ constitutional claims were at least debatable, meaning the government could potentially prevail, and therefore, the first prong was not met. The Court also found that alternative avenues for review exist, including refund actions after a tax is assessed or a statutory procedure allowing a nonprofit to challenge the IRS’s determinations regarding tax-exempt status, before paying the tax. Because these remedies provide a path to judicial review, the Court concluded that the exception did not apply.
Accordingly, the Court dismissed the case without prejudice for lack of subject-matter jurisdiction, without reaching the merits of the constitutional claims as to the Johnson Amendment.
Nat'l Religious Broads. v. Bessent (E.D.Tex. Mar. 31, 2026, No. 6:24-cv-00311) 2026 LX 179375.
Note:
This case has drawn national attention because the IRS agreed, in the proposed consent judgment, to a narrower interpretation of the Johnson Amendment as applied to the two plaintiff churches, suggesting that endorsing candidates by a religious organization would not constitute prohibited political activity. While the consent judgment was limited to those two churches, this case was already being cited as a potential basis for broader arguments by religious nonprofits, and possibly other nonprofits, seeking greater latitude to take positions for or against political candidates. Because the court rejected the settlement on jurisdictional grounds, the Johnson Amendment remains unchanged for now.
Governance
Court Reverses Preliminary Injunction After Finding Corporate Board Lacked Required Votes To Approve Assignment.
This case arose from a dispute over who had the authority to control litigation involving LePort Educational Institute, Inc. (LEI), a company that formerly operated a nationwide network of private Montessori schools. Carl Barney, a major secured creditor and shareholder of LEI, claimed that LEI had formally transferred to him the right to pursue certain legal claims on the company’s behalf. That transfer, referred to as an “assignment,” would have allowed Barney to sue other LEI shareholders and former officers in LEI’s name and to control LEI’s defense of any related counterclaims.
The assignment at issue purported to transfer to Barney all of LEI’s claims against several individuals, including Ramandeep (Ray) and Rebecca Girn, who were former shareholders and officers of LEI. It also purported to give Barney authority to retain counsel for LEI and direct LEI’s litigation strategy in disputes arising out of those claims. In practical terms, if the assignment was valid, Barney, rather than LEI’s management, would control how LEI participated in the lawsuit.
Barney sought to pursue claims alleging that the Girns helped transfer LEI’s Montessori schools, employees, and business relationships to Higher Ground Education, a competing school operator, in violation of their duties to LEI. Thereafter, the Girns filed a cross-complaint that included indemnification claims against both Barney and LEI. At that point, a dispute emerged between Barney and LEI’s founder and CEO, Dr. Peter LePort, over who had the legal authority to act for LEI. Barney asserted that the assignment gave him exclusive control over LEI’s defense of the cross-claims, while Dr. LePort disputed the assignment’s validity and continued to act as LEI’s representative, retaining separate counsel to defend the company. Competing attorneys began filing and withdrawing pleadings on LEI’s behalf, creating confusion over who actually spoke for the company in court.
To resolve that dispute, Barney asked the trial court to issue a preliminary injunction barring Dr. LePort, the Girns, and their attorneys from interfering with LEI’s participation in the case “by and through” Barney as assignee. The Girns opposed the request, arguing that Barney lacked authority because the assignment had never been properly approved by LEI’s board of directors under California Corporations Code section 307, subdivision (a)(8).
The trial court granted the preliminary injunction. Although it acknowledged the late timing of the challenge, the court rejected the validity argument on the merits, concluding that the assignment had been properly approved because a quorum was present at the relevant board meeting and the two directors who voted constituted a majority of those voting. The injunction barred the Girns and others from interfering with Barney’s control of LEI’s defense. The Girns appealed.
The Court of Appeal reversed. Interpreting section 307, subdivision (a)(8) and LEI’s bylaws (which mirrored the language in section 307), the Court of Appeal held that board approval required a majority of the directors present at the meeting, or a majority of the required quorum if directors withdrew. At the meeting approving the assignment, four directors were present, but only two voted in favor after two recused themselves. Under either statutory scenario, three affirmative votes were required. Because only two directors voted to approve the assignment, the Court concluded it was not validly approved by the board.
The appellate court rejected the trial court’s reasoning that a majority of those voting was sufficient, explaining that neither the Corporations Code nor the bylaws permit courts to disregard the number of directors present when calculating a majority.
Because the assignment’s validity was central to Barney’s claimed right to control LEI’s defense, the Court of Appeal held that the preliminary injunction could not stand. The Court reversed the injunction and remanded the matter to the trial court.
Barney v. 01006531 Ramandeep Girn (Feb. 9, 2026, No. G064412) 2026 Cal. App. Unpub. LEXIS 915.
Note:
Although this case arises from a corporate dispute rather than a nonprofit operations issue, it offers an important reminder that Boards must strictly comply with Corporations Code and bylaw voting requirements when enacting decisions.
Wage & Hour
California Court Of Appeal Holds Ministerial Exception Does Not Automatically Bar Wage Claims Against Religious Organization.
Michael Ehrenkranz, a former Work Practice Apprentice (WPA) and staff member at the San Francisco Zen Center, filed wage-and-hour claims with the Labor Commissioner alleging unpaid minimum wages, overtime, split-shift premiums, liquidated damages, unreimbursed expenses, and waiting time penalties. The Zen Center is a nonprofit religious corporation operating three Zen Buddhist temples, including residential training programs. WPAs and staff live at the temples, participate in structured Zen practice schedules, and receive modest stipends along with room and board. Ehrenkranz’s duties included cleaning guest rooms, maintaining grounds, cooking for residents and paying guests, preparing meals during the Center’s commercial summer guest season, and later serving as a teacher’s assistant.
After a wage claim hearing before the California Labor Commissioner (often called a “Berman hearing”), the Commissioner ruled in Ehrenkranz’s favor and awarded him more than $81,000 in unpaid wages and penalties. The decision held both the Zen Center and two of its officers, Linda Galijan and Mike Smith, financially responsible. The Center and the individual officers appealed the decision to the superior court. Under California law, an employer appealing a Labor Commissioner award must post a bond equal to the amount awarded to ensure the employee can collect if they ultimately win; the Zen Center posted that bond, but the individual officers did not post separate bonds.
Defendants moved for summary judgment, arguing that Ehrenkranz’s claims were barred by the First Amendment’s ministerial exception. The trial court agreed and granted summary judgment, concluding that applying California wage-and-hour laws to WPAs would improperly entangle courts in religious governance. Ehrenkranz appealed.
The Court of Appeal reversed the summary judgment. Relying heavily on its companion decision in Lorenzo v. San Francisco Zen Center, which involved nearly identical facts and claims, the Court held that the ministerial exception does not categorically bar wage-and-hour claims simply because the plaintiff qualifies as a minister. Although Ehrenkranz conceded that he was a minister for purposes of the exception, the Court emphasized that the exception
is limited to employment claims that necessarily require judicial inquiry into ecclesiastical decisions, such as hiring, firing, or selection of ministers. Here, Ehrenkranz sought only unpaid wages for work already performed, much of which related to the Center’s commercial activities. The Center conceded that adjudicating the wage claims would not require the court to resolve any ecclesiastical questions. Accordingly, absent evidence that applying wage laws would interfere with internal religious doctrine or governance, the ministerial exception did not apply.
The Court declined to follow Ninth Circuit authority broadly applying the ministerial exception to wage claims, reasoning that those cases provided limited analysis and extended the doctrine beyond the United States Supreme Court’s holdings in other ministerial exception cases. Instead, the Court adopted the reasoning of Lorenzo, concluding that the exception bars only those claims that intrude upon strictly ecclesiastical matters.
The Court of Appeal also addressed a separate issue about who had to post a bond to appeal the Labor Commissioner’s decision. Under California law, when an employer appeals a wage award, it must deposit a bond for the full amount of the award to protect the employee if the appeal fails. Ehrenkranz argued that because the two individual officers were held personally liable along with the Zen Center, they should have been required to post their own separate bonds. The Court disagreed, explaining that the statute requires only the employer to post the bond. Because the Zen Center, the actual employer, posted a bond covering the full award, the legal requirement was satisfied, and the individuals did not need to post separate bonds.
The Court of Appeal therefore reversed the summary judgment based on the ministerial exception but affirmed the denial of Ehrenkranz’s motion to dismiss the individual defendants’ appeals for failure to post separate bonds.
Ehrenkranz v. San Francisco Zen Center (Mar. 2, 2026) 118 Cal.App.5th 977.
Note:
This decision clarifies that California courts will not automatically apply the ministerial exception to bar wage-and-hour claims brought by ministers. Religious employers should carefully evaluate whether compensation structures for their employees could give rise to wage-and-hour exposure.
LCW Welcomes Andrew Dorado, Expanding Benefits and Compliance Services
LCW is pleased to welcome Andrew Dorado as Senior Counsel. Andrew’s addition expands the firm’s ability to advise clients on complex benefits, tax, and retirement plan issues across all sectors we serve.
Andrew counsels employers on a wide range of retirement plans, including defined contribution and defined benefit plans, deferred compensation arrangements, and 403(b) and 457 plans, as well as ERISA and fiduciary compliance. He also advises on IRS and Department of Labor reporting obligations, correction of operational errors, and payroll-related issues that may impact plan compliance or tax status.
His practice is particularly valuable in helping organizations navigate compliance challenges such as late or incorrect contributions, plan administration errors, and reporting requirements, as well as in guiding clients through correction programs, audits, and plan changes.
With Andrew’s arrival, LCW further strengthens its ability to provide comprehensive, practical guidance on employee benefits and payroll compliance issues that increasingly intersect with dayto-day operations.
We are excited to have Andrew join the firm and look forward to the value he will bring to our clients.
Arbitration
California Supreme Court: When The Arbitration Agreement Is Tough To Read, Courts Should Look Closely At The Terms To Determine Enforceability.
For some employers, arbitration agreements are a required document provided to employees during onboarding, which, if disputes arise later in the relationship, employers may use to resolve those disputes in an arbitration setting, rather than in court. However, employees often challenge the enforceability of those agreements, and in Fuentes v. Empire Nissan (decided on February 2, 2026), the California Supreme Court provided a helpful warning to employers that rushing employees to sign agreements with unnecessary fine print and illegible text can add significant strength to employees’ ability to challenge the enforceability of an arbitration agreement.
The Employer Gave The Employee 5 Minutes To Review An Arbitration Agreement Buried In The Fine Print Of Onboarding Documents.
When Evangelina Yanez Fuentes applied to work for Nissan, she signed a document called “Applicant Statement and Agreement.” The agreement required that “any claim” between the employer and the employee “shall be submitted to and determined exclusively by binding arbitration.” The form arbitration agreement stated that the terms could only be modified if “signed by the President of the Company.”
According to the Court, the entire document was one page in length and in a font so small that a photocopy of the agreement was blurry. In fact, the relevant paragraph compelling arbitration contained around 900 words “squeezed into about three vertical inches.” Aside from being difficult to physically read, the agreement contained legal jargon and complex sentences, which made it difficult to understand.
On top of the near-illegible font and complex language, the record showed that Fuentes only had five minutes to review the agreement, which was included with her employment application materials, and was told to hurry because the drug testing facility was about to close. Later during her employment, Fuentes signed two confidentiality agreements regarding Nissan’s trade secrets. These confidentiality agreements would allow Nissan to seek “any proper injunction” along with “any other remedies.” Only Fuentes signed these agreements.
Nissan terminated Fuentes’s employment, following an extended medical leave, and Fuentes sued for discrimination and wrongful termination.
The Trial Court Ruled That The Barely Legible Arbitration Agreement Was Procedurally And Substantively Unconscionable, But The Court Of Appeal Disagreed.
At the start of the case, Nissan filed a motion to compel Fuentes to litigate her claims in arbitration, and Fuentes opposed that motion by arguing that the arbitration agreement was unenforceable due to “unconscionability.” To establish that a contract is unenforceable because it is unconscionable, the party opposing enforcement must show unfairness both in the procedure by which the contract was formed and the substance of its terms. This is called procedural and substantive unconscionability, and at the trial court level, they both must exist.
Procedural unconscionability concerns the fairness of the procedure to form the contract, such as small font, multiple contracts, legal jargon, or extreme time limits that place pressure on an employee to sign the agreement. Substantive unconscionability is about the actual substance of the contract and whether it is fair to the employee. This includes whether the terms and obligations are mutual between the employee and employer.
While both are required to establish the unconscionability defense, the elements are on a sliding scale. The more procedurally unconscionable the contract is in its formation, the less substantively unconscionable it needs to be to establish an unconscionability defense.
The trial court determined that the agreement had a high degree of procedural unconscionability because it was barely legible, difficult to understand, and Fuentes was not provided with sufficient time to review it. Additionally, the court found that the agreement had a low to moderate degree of substantive unconscionability. First, the trial court determined that fine-print terms are substantively unconscionable. Additionally, the court found that the two confidentiality agreements appeared to create a carveout, which would allow Nissan to bring some claims in regular court, like breach of confidentiality claims, in court rather than arbitration. This carveout, therefore, meant that the arbitration agreement did not apply equally, or mutually, to Nissan and Fuentes.
Nissan then appealed to the Second District Court of Appeal, which, importantly, disagreed with the idea that illegibility alone, regardless of the substance of the terms buried in the fine print, qualified as substantively unconscionable.
The Court of Appeal also held that the confidentiality agreements, read in conjunction with the arbitration agreement, required Nissan to arbitrate claims under the confidentiality agreement. Moreover, the Court of Appeal determined that Nissan’s President never signed the confidentiality agreements, thereby not altering the binding arbitration terms of the first agreement. The Court of Appeal found that these findings, along with the presumption that the law favors arbitration, rendered the agreement substantively fair to Fuentes.
The California Supreme Court Reversed: An illegible Font Made The Agreement Procedurally Unconscionable, But Was Not Enough On Its Own To Make Agreement Substantively Unconscionable, But Court Of Appeals Made An Incorrect Assumption.
At the California Supreme Court, the Court found the arbitration agreement had a high degree of procedural unconscionability. In particular, the Court noted Fuentes faced economic pressure, insufficient time to review, complex sentences filled with legalese, and a tiny, blurry font.
The Supreme Court began its next analysis by determining whether “fine-print terms” are substantively unconscionable due to its near illegible form. These
“fine-print terms” are normally one-sided terms buried within large paragraphs, making it difficult to discern unfavorable language. However, the Supreme Court found that “font size” alone “does not affect the substance of an agreement’s terms.”
Next, the Supreme Court looked towards mutuality of the arbitration agreement—whether the terms were fair and even between the parties. There, the Supreme Court noted that Fuentes interpreted the confidentiality agreements to provide an exception for Nissan to bring claims outside arbitration, while Fuentes must continue to bring all her claims through arbitration. The Court, disagreeing with the Court of Appeal, found that the plain language of the confidentiality agreements did not limit Nissan to arbitration. The Court found that the Court of Appeal’s reliance on the proposition that “the law strongly favors arbitration” to be misplaced, and that the presumption is merely that the law does not disfavor arbitration agreements and, accordingly, they should be enforced like any other contract. Further, the Court of Appeal erroneously resolved a factual question that Nissan’s President never signed the confidentiality agreements, which would impact the analysis as to whether the substantive terms of the agreement were fair and mutual. Therefore, the Supreme Court remanded the question as to whether the confidentiality agreements carved out an exception for Nissan, asking the lower court to closely scrutinize the terms of the agreements.
Based on the California Supreme Court’s decision, employers should consider two things. First, employers should make sure that their arbitration agreements and other contracts are legible, in a large enough font, understandable, and that the employee has sufficient time to review them. Second, employers should be careful when having an employee sign multiple agreements throughout their employment. Any ancillary agreements and their terms should be carefully reviewed for potential conflicts with an arbitration agreement.
FAA Governs Arbitration Agreements Based On Parties’ Express Consent.
In August 2017, Sinedou Tuufuli worked as a collector and customer service representative for West Coast Dental, an entity that manages the business operations of affiliated dental practices and provides those practices with support and administrative services.
When Tuufuli was hired, she electronically signed an arbitration agreement, which required that any disputes
with West Coast Dental relating to her employment must be resolved by final and binding arbitration. The arbitration agreement stated that the parties agreed to arbitrate claims based on any federal, state, or local law, including the California Fair Employment and Housing Act (FEHA), the California Labor Code, the California Unfair Competition Law, and the California Wage Orders. It further stated that the arbitrator would not have the authority to preside over class, collective, or other representative proceedings. The arbitration agreement said it would be governed by the Federal Arbitration Act (FAA) and, “to the extent permitted by such Act, the laws of the State of California.”
In April 2023, Tuufuli filed a complaint against West Coast Dental, asserting eight individual and class claims for violations of the Labor Code and the Business and Professions Code. West Coast Dental moved to compel arbitration and dismiss her class claims. It also argued that the arbitration agreement was governed by the FAA.
In March 2024, the trial court granted West Coast Dental’s motion to compel arbitration and dismissed Tuufuli’s class claims. The trial court relied on the evidence West Coast Dental supplied, showing it operated in multiple states and on provisions within the arbitration agreement that said it was governed by the FAA. The trial court dismissed the class claims because the arbitration agreement prohibited Tuufuli from litigating or arbitrating class claims against West Coast Dental. Tuufuli appealed.
The Court of Appeal explained that the FAA reflects a liberal federal policy favoring arbitration agreements. The FAA preempts state laws that “require a judicial forum to resolve claims which the contracting parties agreed to resolve by arbitration.” The FAA applies if the parties expressly agreed that it will. Arbitration under the FAA is a matter of consent, and parties may voluntarily elect to have the FAA govern enforcement of their arbitration agreement.
The Court of Appeal agreed with the trial court that the FAA governed the arbitration agreement between Tuufuli and West Coast Dental because they expressly agreed that it would. The Court of Appeal therefore affirmed the order compelling arbitration and dismissing the class claims.
Tuufuli v. West Coast Dental Administrative Services, LLC (Jan. 13, 2026, No. B338584) 117 Cal.App.5th 1048.
Note:
This decision reinforces that arbitration agreements used by nonprofit employers may be governed by the Federal Arbitration Act based on the parties’ express agreement. Nonprofit employers that wish to invoke FAA governance should ensure their arbitration agreements clearly state that the FAA applies.
New Leadership Appointments!
Liebert Cassidy Whitmore is pleased to announce new leadership appointments across three of its offices.
Alysha Stein-Manes will serve as Co-Managing Partner of the Los Angeles office. Gage Dungy and Michael Youril have been named Office Managing Partners of the Sacramento and Fresno offices, respectively.
In their new roles, Alysha, Gage, and Michael will advance LCW’s strategic growth, strengthen client relationships, and support the continued development of attorneys and staff across the firm.
Immigration
What To Do If Immigration Enforcement Contacts Your Organization.
High-profile U.S. Immigration and Customs Enforcement operations across the country underscore how rapidly moving and emotionally charged immigration enforcement actions can be. Planning for how your organization will respond if federal agents contact or involve employees in an enforcement action can be critical to managing risk and maintaining calm. Below are key legal principles and best practices to consider as your organization develops its action plan.
Immigration Enforcement Visits At The Worksite.
Immigration enforcement officers may appear at a workplace seeking access to facilities or individuals. Employees should remain calm, respectful, and professional, but they should also understand that they generally may not volunteer information or consent to the officers accessing nonpublic areas absent an appropriate warrant.
If immigration officers arrive at the worksite, employers should follow these general principles:
• Request identification. Employers may ask officers to identify themselves, present their credentials, and explain the purpose of the visit.
• Refer the officer to a designated employer contact. Employers should have a protocol directing immigration officers to a central office or designated employee who is trained to review legal documents and coordinate with legal counsel. Frontline employees and supervisors should advise the agents that they are not authorized to receive warrants and direct the agents to the point person.
• Review warrants carefully before granting access to nonpublic areas. Absent exigent circumstances, immigration officers cannot enter a nonpublic area of the workplace without either (1) consent or (2) a valid, signed judicial warrant. Administrative warrants issued by the Department of Homeland Security or one of its branches do not authorize entry into nonpublic spaces. This is because administrative
immigration arrest warrants authorize the arrest of a named individual, but not a search of facilities. By contrast, a judicial search warrant, signed by a judge or magistrate, may authorize law enforcement entry into private spaces to search the premises and seize evidence, but only for the purposes and locations identified in the warrant.
• Verify any asserted exigent circumstances. Exigent circumstances are situations where any delay in permitting officer access to restricted areas would pose a significant risk to the safety of employees or the public. If officers assert emergency circumstances, employees should not interfere with the enforcement action, but they should immediately notify the employer’s designated point of contact and legal counsel.
Employers who consent to immigration enforcement agent access to private or restricted work areas, absent an appropriate warrant, may face penalties of $2,000 to $5,000 for the first violation and $5,000 to $10,000 for each subsequent violation. (Government Code section 7285.1.)
Document Requests By Immigration Enforcement.
U.S. Immigration and Customs Enforcement may also seek access to personnel records, such as I-9s, payroll records, employee names, and other identifying information, and employer policies related to hiring and employment practices. As with in-person enforcement actions, employers should carefully review these requests because disclosing personnel information beyond what is required may result in an invasion of privacy claim in addition to the penalties described above. (See Gov. Code section 7285.2.)
• Identify the type of subpoena. Absent a valid subpoena or court order, employers generally should not allow immigration officers to review or obtain employee records. Like search warrants, administrative and judicial subpoenas differ in the scope of access they confer on enforcement agents.
• Administrative subpoenas or requests directly from immigration agencies typically require the production of specific, identified records, but do not permit broad access to files. Employers are only required to produce the records that the
administrative request specifically describes. Broad or vague requests—such as “all employee records”—are not appropriate.
• Judicial subpoenas, signed by a judge or magistrate, may compel testimony or document production more broadly.
• Route all requests through designated channels. The same point of contact who reviews search warrants should also be responsible for reviewing subpoenas. Employers should have an internal process for reviewing subpoenas and warrants, involving employer leadership and legal counsel, before responding.
• Protect confidential information. Employers should take care not to release any confidential employee information they are not specifically required to release pursuant to a valid request or subpoena.
In the event an employer must grant an immigration agency access to a current employee's records, the law requires the employer to provide the employee advance notice of the inspection within 72 hours of receiving the federal notice of inspection. A template notice to employees can be found on the Labor Commissioner's website. Within 72 hours of the inspection's conclusion, the employer must also provide the employee notice of the inspection's results, including any deficiencies
identified in the employee's documentation and the timeline for correcting them.
A Note On Work Authorization Requirements.
Nothing about the above changes the fact that employers cannot employ individuals who lack valid authorization to work in the U.S. If an employee's work authorization expires—even if their renewal is pending—the employer should not maintain the employee in paid status unless and until their work authorization is renewed.
California Labor Code section 1019.2 prohibits an employer from re-verifying a current employee's employment eligibility at a time or in a manner not required by federal law. This prohibition does not include communications with an employee whose work authorization has expired or is set to expire in the near future. Rather, the law prohibits spontaneous demands that employees reestablish their authorization to work.
Conclusion.
Preparation is key. California employers should train staff on how to respond to immigration enforcement contacts, designate specific points of contact, and ensure leadership understands how to review warrants and subpoenas. When in doubt, pause, verify, and consult counsel before granting access to the workplace or producing documents to federal immigration agents.
EEOC UPDATES
• The U.S. Equal Employment Opportunity Commission (EEOC) released new and updated educational resources to help workers and employers understand and prevent national origin discrimination, including a new one-page technical assistance sheet titled “Discrimination Against American Workers Is Against the Law” and an expanded national origin discrimination webpage with guidance. These materials, grounded in Title VII and existing EEOC policy, explain what unlawful national origin discrimination can look like in hiring, job assignments, harassment, and retaliation, and offer guidance to workers on how to file a charge if they believe their rights have been violated. The updates focus on protections against “anti-American” national origin bias.
• On January 22, 2026, the EEOC voted 2-1 to rescind its 2024 “Enforcement Guidance on Harassment in the Workplace,” citing concerns that portions of the guidance exceeded the agency’s statutory authority, particularly with respect to gender identity interpretations under Title VII. The rescission follows a 2025 federal court ruling that vacated portions of the guidance and reflects the Commission’s shift in enforcement posture. While the guidance has been withdrawn, federal and state antidiscrimination laws remain in effect, and the EEOC has reiterated that combating unlawful workplace harassment continues to be a priority.
• The EEOC recently issued a letter to the country’s largest employers reminding them that diversity, equity, and inclusion (DEI) initiatives must comply with Title VII’s prohibition on discrimination based on protected characteristics such as race and sex. The agency emphasized that labeling a policy as “DEI” does not exempt it from existing anti-discrimination laws and signaled increased enforcement focus in this area. The letter also references new EEOC and DOJ guidance cautioning that employment decisions based on protected characteristics, even if framed as DEI efforts, may violate federal law and could be subject to enforcement. The full letter can be found here.
Did You Know?
Whether you are looking to impress your colleagues or just want to learn more about the law, LCW has your back! Use and share these fun legal facts about various topics in labor and employment law.
• The City of Fresno has adopted an ordinance creating a local framework for the criminal and civil prosecution of wage theft. The ordinance authorizes the City Attorney to pursue criminal misdemeanor charges and civil actions for unpaid wages, willful misclassification of independent contractors, and related Labor Code violations, with penalties that can include restitution, statutory damages, and civil fines.
• A Michigan federal jury awarded $1.8 million to a Muslim teacher who was terminated after refusing to remove her religious veil while teaching, finding the employer failed to provide a reasonable accommodation. The employer, a nonprofit organization that provides education and social services to Arab immigrants, argued that showing facial expressions was necessary for instruction, but the jury concluded that alternatives, such as teaching an all-female class, would not have imposed an undue hardship. The verdict included compensatory and punitive damages under both Title VII and Michigan law, and the employer has indicated it plans to appeal.
Featured Consortium Call
Members of Liebert Cassidy Whitmore’s consortiums are able to speak directly to an LCW attorney free of charge to answer direct questions not requiring in-depth research, document review, written opinions or ongoing legal matters. Consortium calls run the full gamut of topics, from leaves of absence to employment applications, student concerns to disability accommodations, construction and facilities issues and more. Each month, we will feature a Consortium Call of the Month in our newsletter, describing an interesting call and how the issue was resolved. All identifiable details will be changed or omitted.
Question:
The Human Resources Director at a nonprofit employer contacted LCW with a question about lunch breaks for non-exempt employees. The HR Director explained that some non-exempt employees voluntarily take a lunch break that is later than the 5th hour of work in order to run an errand or attend an appointment. The HR Director was looking for guidance about whether this is acceptable under wage and hour laws.
Answer:
The LCW attorney advised that under wage and hour laws, the only reason a non-exempt employee can voluntarily waive their lunch break is if their total shift is less than 6 hours. However, they are not permitted to simply decide to take a lunch break that is beyond the 5th hour for reasons of convenience. Employees are also allowed to work through lunch in limited circumstances where the nature of their job prohibits them from being able to break, but the LCW attorney advised that this does not seem to be the case here, based on the job duties for the employee at issue. In addition, in such cases, there needs to be documentation, and the non-exempt employee still must be paid for that time.
Liebert Cassidy Whitmore