In a matter of great interest to many employers, last week, the United States Supreme Court agreed to decide whether arbitration agreements that prohibit employees from pursuing class and collective remedies are enforceable. Courts are currently divided on the issue. The Supreme Court granted certiorari in three cases, Epic Sys. Corp. v. Lewis, from the Seventh Circuit, Ernst & Young LLP v. Morris, from the Ninth Circuit, and NLRB v. Murphy Oil, USA, from the Fifth Circuit, to resolve the question.
The dispute pits the savings clause of the Federal Arbitration Act (“FAA”), 9 U.S.C. §2, which allows invalidation of arbitration agreements only “upon such grounds as exist at law or in equity for the revocation of any contract” against employees’ rights to engage in protected, concerted activity under the National Labor Relations Act, 29 U.S.C. §157. The National Labor Relations Board (“NLRB”) takes the position that provisions in arbitration agreements requiring employees to waive their rights to pursue class or collective actions violate employees’ rights to engage in protected, concerted activity under the National Labor Relations Act (“NLRA”). In May 2016, the Seventh Circuit agreed and Continue reading