NLRA v. FAA – US Supreme Court will decide class-action waiver cases

Ever since D.R. Horton (NLRB 2012), the NLRB has said that it's an unfair labor practice for an employer to require employees to agree that they will not bring a class-action or collective-action case, either in litigation or in arbitration. The NLRB's jurisdiction includes non-union workplaces in the private sector, so there's an impact on over 90% of private sector employees.

Meanwhile, the Federal Arbitration Act requires courts to enforce arbitration agreements as written.

As you might expect, federal circuit courts are split. Some say D.R. Horton is simply wrong. Some say the FAA compels enforcement of an employment arbitration agreement that prohibits employees from bringing a class-arbitration, notwithstanding D.R. Horton. Others won't enforce such agreements because they interfere with employees' right "to engage in … concerted activities for the purpose of … mutual aid or protection."

The Supreme Court has agreed (on January 13) to hear three cases that raise these issues.

One is Ernst & Young v. Morris [Cert petition] [9th Circuit opinion] [Supreme Court briefs ("an employer violates the National Labor Relations Act by requiring employees to sign an agreement precluding them from bringing, in any forum, a concerted legal claim regarding wages, hours, and terms of conditions of employment.")

The others are NLRB v. Murphy Oil [Cert petition] [5th Circuit opinion] [Supreme Court briefs] (refusing to enforce the NLRB's D.R. Horton rule) and Epic Systems Corp v. Lewis [Cert petition] [7th Circuit opinion] [Supreme Court briefs(class action waiver in arbitration agreement violates NLRA and is unenforceable under the FAA).

The Court neither granted nor denied one other petition in Patterson v. Raymours Furniture Co  [Cert petition] [2nd Circuit opinion] [Supreme Court briefs(enforcing class action waiver in arbitration agreement).

Update: Oral arguments will be in October, with a decision expected early in 2018.

Am I the only one wondering whether the incoming administration will argue in favor of the NLRB's position in the NLRB v. Murphy Oil case? 

[For recent decisions and pending employment law cases, see Supreme Court Watch.]


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