The Continuing Struggle over Class Action Waivers in Employment Arbitration - The Circuits are Split.
By Robert Arrington
Section 7 of the National Labor Relations Act (“the NLRA”), 29 U.S.C.§ 157, provides, in pertinent part, that “[e]mployees shall have the right…to engage in…concerted activities for the purpose of collective bargaining or other mutual aid or protection.” (Emphasis supplied.) Interference with Section 7 rights is an unfair labor practice under Section 8 of the NLRA. 29 U.S.C. §158(a)(1). Read more
Are Employment Class Actions Headed Toward an Epic Fail?
By Alejandro Caffarelli, Caffarelli & Associates Ltd.
In the 2016 case of Lewis v. Epic Systems Corp., the Seventh Circuit Court of Appeals held that class action waivers in employee arbitration agreements violate the National Labor Relations Act (“NLRA”) in that they hinder an employee’s right to engage in protected, concerted activity. The Court reasoned that such agreements are not subject to mandatory arbitration under the Federal Arbitration Act (“FAA”) because they are subject to the FAA savings clause, which, among other things, voids “illegal” arbitration agreements. Read more
SCOTUS to Decide Future of Class Waiver Arbitration Clauses
By J. Kevin Hennessy
From Fortune 500s to regional warehouses, employers have long relied on arbitration clauses that prohibit class or collective action employment claims in order to minimize legal costs and financial exposure. However, the National Labor Relations Board (NLRB) and a patchwork of court decisions have put those clauses under increasing scrutiny, and in its next term, SCOTUS will finally decide if such waivers are enforceable. Read more
D.R. Horton and Murphy Oil in Their Statutory and Historical Context—How Did We Get Here and Where Are We Going?
By Wesley Kennedy
On January 13, 2017, the Supreme Court granted certiorari in three consolidated cases to resolve a Circuit conflict over the National Labor Relations Board’s D.R. Horton/Murphy Oil doctrine, which holds it unlawful to condition the employment of unrepresented employees on waiver of the right to engage in class litigation. The cases will be heard in the Court’s 2017-2018 term. D.R. Horton and Murphy Oil are the culmination of developments under the Federal Arbitration Act (FAA) and the National Labor Relations Act (NLRA). Viewed in context, the NLRB’s decisions represent the straightforward application of the text and well-settled interpretation of the NLRA, and are consistent with the FAA. Read more
On a Collision Course
By Dana Welch
This Supreme Court term will resolve a cavernous split in the Circuits on an issue of significant import to arbitrators, government agencies, workers and management. Are class action waivers contained in arbitration clauses in agreements governed by the National Labor Relations Act (NLRA) enforceable? On one side are the Seventh and Ninth Circuits, which have upheld the National Labor Relation Board’s position that collective action is a substantive right created by the NLRA, specifically exempted by the savings clause of the Federal Arbitration Act. Read more
