Business Workshop / NLRB starts 2012 where it left off in 2011: Says workers can't be forced to sign class waivers
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In early January, the two Democrats on the National Labor Relations Board issued a decision that concluded that employers may not force employees to sign, as a condition of employment, an agreement requiring the arbitration of disputes if the agreement includes a waiver of the ability to bring a class claim over wages, hours or other working conditions because such a prohibition runs directly in conflict with Section 7 of the National Labor Relations Act, which guarantees employees the right to bargain and organize collectively over those subjects.
The decision in this case is particularly interesting because it stands in stark opposition to the decision of the U.S. Supreme Court in AT&T Mobility v. Concepcion, where the court found that the Federal Arbitration Act pre-empts state laws which say class waivers are impermissible.
In short, the Supreme Court came out in support of voluntary, agreed-to arbitration agreements, even if they waive class claims.
In its decision, the NLRB has essentially shunned the notion of public policy favoring two private parties coming to a consensus on an arbitration agreement, even if it involves a class waiver. Because of that, this may be an issue that ultimately has to return to the Supreme Court. The board may not feel its decision, D.R. Horton, Inc. and Michael Cuda, Case 12-CA-25764, creates a conflict between the Federal Arbitration Act and the National Labor Relations Act, but many in the employer community feel otherwise.
Until this is sorted out, employers should consult counsel if they are thinking about either creating a new arbitration agreement or modifying an existing one to include such a waiver, or if they already have an agreement with such a provision in place.
-- Mario Bordogna
Steptoe & Johnson PLLC, mario.bordogna@steptoe-johnson.com
First Published February 13, 2012 12:00 am
