Several employment cases currently working their way through the appellate courts are poised for California Supreme Court review in 2026. These cases do not just clarify narrow disputes—they have the potential to reshape everyday HR practices, from timekeeping and onboarding to arbitration strategy and PAGA exposure.

Below are three cases HR teams should closely monitor, with a focus on the specific legal questions now positioned for review by the California Supreme Court.

Camp v. Home Depot U.S.A., Inc.

In Camp, an employee sued for unpaid wages, challenging the employer’s quarter-hour rounding policy. The employer’s timekeeping system tracked employee work time to the exact minute, but the rounding policy resulted in some lost compensable time.

In allowing the employee’s claims to proceed, the Court of Appeal questioned whether traditional rounding policies remain lawful when employers already capture precise time data. The court expressed skepticism about the continued validity of older cases approving “neutral” rounding policies and suggested those precedents may no longer be controlling.

The Supreme Court will decide whether California employers may continue to use rounding policies when they track time to the minute, or instead pay for actual time worked regardless of rounding neutrality.

The Court of Appeal’s decision signals that rounding policies—long considered acceptable—may be on shaky ground. If the Supreme Court agrees, employers could face widespread exposure for practices that were once standard.

Fuentes v. Empire Nissan, Inc.

In Fuentes, an employee argued that an arbitration agreement was unenforceable because it was printed in extremely small font and difficult to read. The trial court agreed and denied the employer’s motion to compel arbitration.

The Court of Appeal reversed the trial court and held that font size and readability issues relate only to procedural unconscionability. Standing alone, those issues cannot establish substantive unconscionability or justify refusing to enforce an arbitration agreement.

The Supreme Court will decide whether procedural flaws in arbitration agreements—such as font size, formatting, or presentation—should factor into determining enforceability, and whether such flaws can invalidate an agreement absent substantive unfairness.

Although the Court of Appeal’s ruling favors employers, the Supreme Court could refine the standards governing arbitration agreement enforceability.

Leeper v. Shipt, Inc.

In Leeper, an employee filed a lawsuit asserting only representative PAGA claims and expressly disclaimed any individual PAGA claim. The trial court denied the employer’s motion to compel arbitration.

The Court of Appeal reversed, holding that every PAGA action necessarily includes an individual claim by operation of law, even if the employee does not plead one. Because the individual claim existed, that claim had to be compelled to arbitration under the parties’ agreement, and the representative PAGA claims were put on hold pending the completion of arbitration.

The Supreme Court will decide whether an employee can avoid arbitration by pleading only representative PAGA claims, or whether individual PAGA claims are legally unavoidable and must be arbitrated when an agreement exists.

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These cases reflect a broader trend: California courts are reassessing long-standing employment practices in light of modern technology, procedural fairness, and enforcement realities. So, practices historically considered “compliant” may not remain so.

Yet another reason to join our last “Annual Employment Law Update 2026” webinar in January. Register here! Space is limited.

About Shaw Law Group 

At Shaw Law Group, we do more than practice employment law—we partner with employers to build compliant, respectful, and productive workplaces. From day-to-day advice and counsel to impartial workplace investigations, proactive HR audits, dynamic training programs, and sensitive pre-litigation matters, our experienced team helps clients stay ahead of the curve—and out of court.