Total Articles: 39
Phelps Dunbar LLP • July 24, 2019
The question of whether class arbitration can proceed will be decided by courts and not arbitrators. That decision was made by the U.S. Court of Appeals for the Fifth Circuit in a case that put the spotlight on employee arbitration agreements.
Littler Mendelson, P.C. • July 22, 2019
A properly implemented employment arbitration program can provide a variety of benefits to employers and employees alike. Many employers have robust arbitration programs that require both the employer and its employees to arbitrate any covered claim either may have against the other. These arbitration programs also very often contain a class and collective action waiver, whereby employees who are part of the program agree not only to waive a jury trial in favor of arbitration but also to waive their right to proceed collectively in a class or collective action lawsuit against their employer. The United States Supreme Court has issued a series of opinions in recent years that leave no doubt as to the enforceability of employment arbitration agreements that contain class and collection action waivers. The result has been to provide employers with an important tool to stem the ever-increasing tide of class and collective employment-related litigation.
Ogletree Deakins • July 08, 2019
In response to the #MeToo movement, a number of states have adopted legislation addressing sexual harassment claims. These include Maryland, New Jersey, New York, and Washington. Some of these state statutes attempt to ban or restrict arbitration for sexual harassment claims.
Jackson Lewis P.C. • June 30, 2019
An agreement to arbitrate sexual harassment claims is enforceable pursuant to the Federal Arbitration Act (FAA), federal Judge Denise Cote has ruled, rejecting arguments that New York law voids such an agreement. Latif v. Morgan Stanley & Co. LLC, et al., No. 1:18-cv-11528 (S.D.N.Y. June 26, 2019).
Fisher Phillips • January 23, 2019
My colleagues Andy Scott and Felix Digilov reported on last week’s Supreme Court decision that rejected a trucking company’s effort to force its drivers to arbitrate their wage and hour claims against the company, despite the fact they had signed otherwise enforceable arbitration agreements (New Prime Inc. v. Oliveira). The reasoning behind that ruling? The SCOTUS held that the Federal Arbitration Act’s exemption that excludes “contracts of employment of workers engaged in interstate commerce” includes not only interstate transportation workers with employment agreements, but also those interstate transportation workers with independent contractor agreements. Now, a prominent labor law commentator posits whether this same decision could cause trouble for Lyft, Uber, and other gig economy companies.
Ogletree Deakins • January 10, 2019
On January 8, 2019, the Supreme Court of the United States decided whether courts may disregard contractual language calling for an arbitrator to decide questions of arbitrability if the argument that the arbitration agreement applies to the particular dispute is “wholly groundless.” The Court ruled that a “wholly groundless” exception is inconsistent with the Federal Arbitration Act (FAA), and courts are not free to override the terms of parties’ agreements to arbitrate. Henry Schein, Inc. v. Archer and White Sales, Inc., Supreme Court of the United States, No. 17-1272 (January 8, 2019).
Fisher Phillips • January 08, 2019
In a unanimous opinion issued today, the United States Supreme Court continued its expansive reading of the Federal Arbitration Act and arbitration provisions, rebuffing an effort by some to erect an additional hurdle that would interfere with an employers’ ability to enforce arbitration agreements (Henry Schein Inc. v. Archer and White Sales Inc.). By rejecting the “wholly groundless” exception that courts had used to “spot-check” whether a claim of arbitrability was plausible before compelling arbitration, all lower federal courts must now compel arbitration in all cases where the parties have agreed to delegate the issue of “who decides what is arbitrable” to an arbitrator.
Littler Mendelson, P.C. • November 07, 2018
As recent Supreme Court decisions have surveyed and expanded the landscape of arbitration and arbitration agreements, employers have placed greater focus on whether arbitration is actually the right fit for their company.
Nexsen Pruet • November 06, 2018
A recent decision of the United States District Court of South Carolina again demonstrated a liberal federal policy favoring arbitration agreements. Suzanne Young v. AMISUB of South Carolina, Inc. d/b/a Piedmont Medical Center, 2018 WL 5668619 (November 1, 2018). While analyzed here in the context of an employment dispute, the guiding principles are equally applicable to other contexts.
Ogletree Deakins • October 17, 2018
The oral arguments on October 3, 2018, before the Supreme Court of the United States in New Prime, Inc. v. Oliveira have created waves of uncertainty in the transportation industry about the enforceability of arbitration agreements. The question before the Court is whether the Federal Arbitration Act’s (FAA) requirement that courts enforce arbitration agreements applies to the huge contingent of independent contractors working in the transportation industry. Specifically, while the FAA has an exemption for “contracts of employment” for “workers” in the transportation industry, there is a dispute as to whether this exemption is limited to employees or is intended to encompass independent contractors as well.
Jackson Lewis P.C. • October 08, 2018
On October 3, 2018, the U.S. Supreme Court heard oral argument in New Prime Inc. v. Oliveira, No. 17-340. While the case turns on what may appear to be a simple question of statutory interpretation, the outcome could have profound consequences for employers throughout the transportation industry, for hundreds of thousands of independent owner-operators, and eventually for all consumers.
Jackson Lewis P.C. • September 27, 2018
In a matter of first impression before the Eleventh Circuit Court of Appeals, and an issue left open by the U.S. Supreme Court, the Eleventh Circuit has ruled that who decides whether an action can be litigated as a class in arbitration is an issue of “arbitrability” and those are all to be decided by the court in the absence of terms of the arbitration agreement that evince a “clear and unmistakable intent” to overcome that default presumption. JPay, Inc. v. Kobel, No. 17-13611 (11th Cir. Sept. 19, 2018).
Brody and Associates, LLC • July 02, 2018
In early February, all the Attorneys General in the United States and United States territories, fifty-six in all, sent a letter to Congress advocating for federal legislation prohibiting arbitration provisions in sexual harassment cases. The significance of the #MeToo movement can be seen in this showing of unity because the Attorneys General have not all acted together for a common cause in over a decade!
Nexsen Pruet • February 21, 2018
Courts usually enforce mandatory arbitration agreements in the employment context if the agreements are not too one-sided.
FordHarrison LLP • July 25, 2017
Overview: By Decision dated July 19, 2017 (the “Decision”), the Appellate Division, First Department (the “First Department”) (which has jurisdiction over Manhattan and Bronx) held that arbitration agreements obligating employees to waive their rights to bring collective disputes, such as class actions regarding wage disputes, were unlawful and unenforceable because they “run afoul of the National Labor Relations Act” (the “NLRA”). Though freely acknowledging that the United States Supreme Court will resolve a similar issue in its October 2017 Term, the Decision currently binds the trial courts in Manhattan and Bronx and has precedential effect for other trial courts throughout New York. The Decision can be appealed to New York’s highest court, the New York Court of Appeals.
Ogletree Deakins • June 07, 2017
The First Circuit Court of Appeals, in a case of first impression, recently issued an important ruling that will have a major impact on transportation companies using arbitration agreements in the states and territories located within the First Circuit (Massachusetts, New Hampshire, Maine, Rhode Island, and Puerto Rico). Specifically, on May 12, 2017, the court ruled in Oliveira v. New Prime, Inc., No. 15-2364 that (1) when a federal district court is ruling on a motion to compel arbitration under the Federal Arbitration Act (FAA), the court—and not the arbitrator—must first determine if the FAA applies, and (2) the FAA Section 1 transportation worker exception applies to independent contractor arrangements. The First Circuit’s ruling in Oliveira has deepened the circuit split on the issue of whether the determination of FAA coverage is an arbitrable issue and has made it that much harder for transportation companies to utilize arbitration agreements with independent contractors in the First Circuit.
Littler Mendelson, P.C. • May 18, 2017
On May 15, 2017, the U.S. Supreme Court reiterated the principle that the Federal Arbitration Act (FAA) requires states to treat arbitration agreements just as they treat other types of contracts. In Kindred Nursing Centers L.P. v. Clark, the Court reversed in part a decision of the Kentucky Supreme Court, which had instituted a new rule chipping away at the enforceability of arbitration agreements under certain circumstances.1 Justice Kagan wrote the majority 7-1 opinion and, moreover, was joined by other liberal-leaning members of the Court.2 While newly-confirmed Justice Gorsuch did not participate, the Kindred Nursing Centers decision reaffirms the Supreme Court’s continued commitment to uphold arbitration agreements under the FAA to the greatest extent possible.
Ogletree Deakins • November 08, 2016
Defendants who try their hands at litigation on the merits and seek arbitration only after things don’t go their way, risk losing the right to arbitrate—as the Ninth Circuit Court of Appeals made clear in the recent case of Martin v. Yasuda . In the case, the court barred a beauty school and its president from arbitration after they took a series of actions the court held were inconsistent with the right to arbitrate. These included filing a mostly unsuccessful motion to dismiss, submitting a detailed discovery plan to the court, negotiating with the plaintiff regarding discovery responses, telling the judge “we are probably just better off being here in the court,” and waiting for 17 months after the start of the case to move to compel arbitration.
Littler Mendelson, P.C. • October 26, 2016
In Ziober v. BLB Resources, Inc., 2016 U.S. App. LEXIS 18516 (9th Cir., Oct. 14, 2016), the United States Court of Appeals for the Ninth Circuit joined three other circuit courts in holding that the Uniformed Services Employment and Reemployment Rights Act (USERRA) does not prohibit the compelled arbitration of claims under the Act. The Ninth Circuit’s ruling helps solidify the right of employers to compel arbitration of USERRA claims under a valid arbitration agreement, particularly in light of this Circuit’s perceived hostility towards arbitration of employment-related claims. Ziober provides further support for the view that a properly drafted arbitration agreement provides employers with the ability to arbitrate USERRA claims and avoid litigation.
XpertHR • October 26, 2016
The 9th Circuit Court of Appeals has ruled that the Uniformed Services Employment and Reemployment Rights Act (USERRA) does not prohibit a mandatory arbitration clause covering all employment discrimination claims. The finding in Ziober v. BLB Resources, Inc., is significant because the San Francisco-based federal appellate court has occasionally struck down mandatory arbitration provisions in other cases.
Ogletree Deakins • September 13, 2016
The arbitration restrictions contained in Executive Order 13673, Fair Pay and Safe Workplaces (EO 13673), have been largely overshadowed by other parts of the so-called “contractor blacklisting” rules. Nonetheless, for those federal contractors that have adopted or are considering adopting an employee arbitration program, the arbitration restrictions in EO 13673 are just as significant—and more imminent.
Fisher Phillips • September 13, 2016
A few days ago, Uber won a significant battle when the 9th Circuit Court of Appeals overturned a lower court’s decision and upheld the company’s arbitration agreements. No doubt about it, this is a big win. You might remember a few weeks ago when I wrote a post entitled, “Will Uber Actually Be Happy It’s $100M Settlement Fell Apart?” If I had a chance to edit that post now, I’d replace the six paragraphs of analysis with a one-word answer:
Fisher Phillips • September 13, 2016
There’s a great scene in the Naked Gun movie where Lieutenant Frank Drebin (Leslie Nielsen) is trying to clear a crowd forming around a crime scene, except that the crime scene happens to be a fireworks factory on fire. While a massive pyrotechnic fireworks show is going on behind him, Drebin vainly yells to the gathering crowd, “Move along! Nothing to see here! Please disburse! Nothing to see here!”
Jackson Lewis P.C. • September 12, 2016
On September 7, 2016, the Ninth Circuit Court of Appeals in Mohamed v. Uber Technologies, Inc. largely overturned the District Court’s ruling which had held Uber’s arbitration agreements to be unenforceable. Last year, the District Court had held that the arbitration agreements were unconscionable due to the inclusion of a waiver of claims brought under California’s Private Attorneys General Act (“PAGA”). The decision invalidated nearly 250,000 arbitration agreements between Uber and independent drivers, allowing the case against Uber to proceed as a class action in civil court.
Fisher Phillips • September 12, 2016
The 9th Circuit Court of Appeals delivered a significant victory to Uber and other gig economy businesses by reversing a trial court’s denials of Uber’s motions to compel arbitration in companion class action lawsuits brought by former drivers in Massachusetts and California. The decision not only provides tremendous leverage to Uber as it continues to fight class action litigation over classification issues, but it also boosts gig employers in their efforts to require mandatory arbitration instead of costly courtroom battles.
Nexsen Pruet • September 08, 2016
Within hours of Gretchen Carlson suing then-Fox News CEO Roger Ailes for sexual harassment, Ailes’ attorney responded that Carlson was “desperately attempting to litigate [her termination] in the press.” It didn’t take much longer for Ailes to follow this comment with a formal motion to thwart Carlson’s supposed dreams of a public trial; two days after Carlson instituted her lawsuit, Ailes filed a motion to compel arbitration of the claims pursuant to an arbitration provision contained in Carlson’s employment agreement with Fox News.
Ogletree Deakins • September 01, 2016
A fundamental tenet of arbitration is that arbitration awards are subject to very limited review and are rarely vacated due to an error in contract interpretation. The Illinois Uniform Arbitration Act sets forth just five limited grounds under which a court can vacate an arbitration award, including fraud; evident partiality; where the arbitrators exceeded their powers; where the arbitrators refused to permit material evidence; or where no arbitration agreement existed. 710 ILCS 5/12. Illinois courts will usually not vacate an arbitration award for mere “errors in judgment or mistakes of law” unless “gross errors of judgment in law or [ ] gross mistake[s] of fact” are “apparent on the face of the award.” Rauh v. Rockford Products Corp., 574 N.E.2d 636, 644 (Ill. 1991).
Jackson Lewis P.C. • December 28, 2015
Despite recent U.S. Supreme Court decisions strongly upholding the enforceability of class action waivers in arbitration agreements, opposition to class action waivers on both the political and legal fronts persists, especially in California.
Carothers DiSante & Freudenberger LLP • December 15, 2015
Today the U.S. Supreme Court issued its opinion in DirectTV v. Imburgia, reversing a California Court of Appeal’s refusal to enforce a consumer arbitration agreement containing a class action waiver. The case involves a service agreement between DirectTV and its consumers, stating that any dispute between DirectTV and the consumer will be resolved by binding, individual arbitration and that the consumer waives the right to pursue any claim on a class basis. However, the agreement further provided that if the class waiver is unenforceable under “the law of your state” (the state where the consumer resides), then the entire arbitration provision will be deemed unenforceable.
Fisher Phillips • December 14, 2015
In a 6-3 decision, the U.S. Supreme Court ruled today in favor of the enforceability of arbitration clauses, once again communicating the court’s enduring preference for the enforcement of arbitration provisions. Although today’s decision did not specifically involve employment law, it should give a boost to those companies that choose to utilize arbitration agreements with their workforces. DirecTV, Inc. v. Imburgia.
FordHarrison LLP • December 04, 2013
Executive Summary: In a long awaited decision, D.R. Horton v. National Labor Relations Board, (Case. No. 12-60031, Dec. 3, 2013), the Fifth Circuit Court of Appeals vacated the January 2012 ruling of the National Labor Relations Board ("NLRB") that invalidated an employee's arbitration agreement containing a class action waiver.
Ogletree Deakins • August 08, 2013
The Supreme Court of the United States recently issued two landmark rulings affecting the viability of arbitration as an alternative to costly litigation. As a result, every employer of every size needs to reassess whether the protections an arbitration agreement can afford are worth the potential negative ramifications.
Fisher Phillips • June 18, 2013
Some employers have decided that it is beneficial to try to avoid public lawsuits and arbitrate disputes they may have with their employees. Such employers typically require employees to agree to arbitration at the time of employment by including such language in their employment applications or other documents that are signed by employees.
Nexsen Pruet • September 08, 2010
The U.S. Supreme Court continues to issue rulings favorable to arbitration agreements
in the employment setting. Employers who have arbitration agreements with their
employees, or those considering putting such agreements in place, should make sure
their agreements are drafted and updated to take full advantage of developing Supreme
Court precedent. The two most recent Supreme Court decisions and their implications
for employers are addressed below.
Ogletree Deakins • August 23, 2010
On June 21, with Justice Antonin Scalia writing for a 5-4 majority, the U.S. Supreme Court issued an important decision for employers that are utilizing or are considering adopting arbitration agreements. The Court addressed the enforceability of an arbitration agreement (included as part of an employment contract), which stated that the arbitrator determines the enforceability of the contract. According to the majority, because the employee in this case challenged his employment contract as a whole, rather than specifically chal-lenging the provision in the agreement granting the arbitrator the authority to determine enforceability (the "delegation provision"), the agreement to arbitrate must be evaluated by the arbitrator, not a court.
Ogletree Deakins • December 29, 2009
The first bill signed into law within days following President Barack Obama's inauguration was the Lilly Ledbetter Fair Pay Act. This law extended the statute of limitations for filing charges of discrimination in compensation beyond the statutory 180/300 days from the alleged discriminatory act by making each new pay check a separate violation triggering a new period of charge filing (even if it was decades after the act in question). The law reversed the U.S. Su-preme Court's 5-4 decision in Lilly Ledbetter v. Goodyear Tire & Rubber Co. It was passed without congressional hearings or even a mark-up in a congressional committee.
Fisher Phillips • December 09, 2009
On December 8, 2009, the U.S. Supreme Court issued a unanimous decision holding that a panel of the National Railroad Adjustment Board (NRAB) violated the Railway Labor Act (RLA) when it refused to hear five grievance cases on the ground that the railroad and the union had not presented sufficient evidence to show that they had completed the required "conferencing" before arbitration.
Ogletree Deakins • November 03, 2009
In early October, the U.S. Supreme Court began hearing oral arguments in the 2009-2010 term. There are currently seven cases on the docket that involve employment and labor related issues or are likely to impact these areas. One of the most notable of these will decide how much time plaintiffs have to file a lawsuit when they believe they have been unfairly penalized by hiring tests. Other cases will resolve issues involv-ing an alleged whistleblower, pension benefits, race discrimination, and labor arbitration.
Fisher Phillips • September 04, 2008
Employers with currently valid arbitration agreements should keep in mind that nothing lasts forever. Just as the world is constantly changing, so too are court decisions relating to implementation and enforcement of arbitration agreements always evolving. The case at issue involves the U.S. Court of Appeals for the Ninth Circuit, which covers ten states in the western United States. But circuits read each others' cases and the principles established by one are frequently applied elsewhere. This case points up the need to always be aware of any binding arbitration agreements and their details when dealing with employee issues.