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Supreme Court Restricts Employee Class Actions in Pro-Arbitration Ruling

Companies may compel their employees to arbitrate workplace disputes individually rather than as part of a class action, the US Supreme Court has ruled. The Court's 5-4 decision in Epic Systems Corp. v. Lewis broke down along partisan lines and could affect an estimated 25 million employment contracts.


This morning, the United States Supreme Court issued its long-awaited opinion in three consolidated cases pending before it (NLRB v. Murphy Oil Co.; Epic Systems Corp. v Lewis; Ernst & Young LLP v. Morris) on the issue of whether a class action waiver provision in an employment arbitration agreement violates the National Labor Relations Act (“NLRA”) and is, thereby, unenforceable.

U.S. Supreme Court's Watershed Decision Preserves Arbitration Agreements, for Now - Dissent Encourages Legislature to Attempt to Reverse the Decision

Executive Summary: Yesterday, the Supreme Court, in a strongly divided 5-4 ruling, upheld mandatory arbitration agreements prohibiting employees from bringing employment claims on a class or collective basis. That decision, Epic Systems Corp. v. Lewis, is available here. This long-awaited decision is one of the most important in employment law in the past several years. As the thirty-page dissent made clear, however, depending on the make-up of a new Congress, we may see legislation that reverses this ruling. Nevertheless, the Court’s ruling is straightforward, expected and the clear law of the land going forward.

Supreme Court Finds in Favor of Employment Arbitration Clauses

On Monday, the Supreme Court issued an opinion regarding the validity of arbitration clauses in individual employment contracts. The decision, referred to here as “Epic Systems,” consolidated three separate cases-- Epic Systems Corp. v. Lewis, Ernst & Young, LLP v. Morris, and NLRB v. Murphy Oil, USA. At issue was the question of whether employers could require that employment disputes be settled through individual arbitration or whether waivers of the ability to proceed with a class or collective action necessarily violate the command of entirely different statutes that allow employees to engage in collective or concerted activity. In a 5 to 4 holding, the Court affirmed that such arbitration provisions are valid and enforceable.

eLABORate: Supreme Court Gives All Clear for Class Arbitration Waivers

The Federal Arbitration Act (FAA) has long permitted employers to require employees to agree to arbitrate legal claims that may arise out of their employment. Today, the United States Supreme Court ruled that this extends to class and collective actions.

Supreme Court Sides With Employers on Individual Arbitration, Class Action Waiver Agreements

The United States Supreme Court in a 5-4 decision ruled that employment agreements forcing workers to forgo pursuing class action claims are legal and do not violate the National Labor Relations Act. Specifically, the court held that arbitration agreements that include class waiver provisions as a condition of employment do not violate federal labor law.

Supreme Court Upholds Lawfulness of Class and Collective Action Waivers in Arbitration Agreements

The Supreme Court has weighed in: class and collective action waivers in arbitration agreements are lawful and must be enforced under the Federal Arbitration Act (FAA). The Court’s decision ends a circuit split and overturns the National Labor Relations Board’s (NLRB) position that class and collective action waivers violate employees’ rights under the National Labor Relations Act (NLRA). Ever since the NLRB’s 2012 decision in D.R. Horton, courts have wrangled with the enforceability of class action waivers and the interaction between the NLRA and the FAA. The Supreme Court’s decision in Epic Systems Corp. v. Lewis (Epic) brings an end to the dispute.1 In a 5-4 opinion authored by Justice Gorsuch, the Court held the FAA requires arbitration agreements to be enforced on the same grounds as any other contract, and the NLRA, which was enacted after the FAA, contains no contrary congressional command excluding class action waivers from the FAA’s mandate.

Supreme Court: Class Action Waivers in Employment Arbitration Agreements Do Not Violate Federal Labor Law

Class action waivers in employment arbitration agreements are enforceable under the Federal Arbitration Act (FAA), the U.S. Supreme Court has held in a much-anticipated decision in three critical cases. Epic Systems Corp. v. Lewis, No. 16-285; Ernst & Young LLP et al. v. Morris et al., No. 16-300; National Labor Relations Board v. Murphy Oil USA, Inc., et al., No. 16-307 (May 21, 2018).

Epic Win: Supreme Court Saves Employment Arbitration As We Know It

To the relief of employers across the country, the Supreme Court today ruled in a 5-to-4 decision that class action waivers in employment arbitration agreements do not violate the National Labor Relations Act (NLRA) and are, in fact, enforceable under the Federal Arbitration Act (FAA). The decision in the three consolidated cases—Epic Systems Corporation v. Lewis; Ernst & Young, LLP v. Morris; and NLRB v. Murphy Oil USA, Inc.—maintains what had long been the status quo and halts the National Labor Relations Board’s (NLRB’s) crusade to invalidate mandatory class waivers. What do employers need to know about today’s monumental decision, and what adjustments can you make to capitalize on the Court’s ruling?

Supreme Court Issues Pro-Employer Ruling on Class Action Waiver Issue

n May 21, 2018, the Supreme Court of the United States settled the contentious class action waiver issue that has riled courts for the past six years. In a 5-4 opinion, the Court upheld class action waivers in arbitration agreements. Relying heavily on the text of the Federal Arbitration Act (FAA) and “a congressional command requiring us to enforce, not override, the terms of the arbitration agreements before us,” the Court ruled that the FAA instructs “federal courts to enforce arbitration agreements according to their terms—including terms providing for individualized proceedings.” The Court also reasoned that neither the FAA’s savings clause nor the National Labor Relations Act (NLRA) contravenes this conclusion. Epic Systems Corporation v. Lewis, Supreme Court of the United States, Nos. 16–285, 16–300, 16–307 (May 21, 2018).