Do Mandatory Arbitration Agreements with Concerted Action Waivers Violate Employee Rights?


By: Pamela Everett
The United States Court of Appeals for the 11th Circuit is poised to address whether Samsung Electronics America, Inc. violated Section 8(a)(1) of the NLRA by requiring its employees to sign an arbitration agreement waiving their rights to maintain class or collective work-related claims in any forum. The ruling in this case could force the Supreme Court to address this issue soon to resolve a widening circuit split.
On August 18, 2015, in the case of Samsung Electronics America, Inc. f/k/a Samsung Telecommunications America, LLC, Case No. 12-CA-145083, Administrative Law Judge Joel Biblowitz struck down a provision requiring employees and the company to arbitrate any class action lawsuit. However, he did not find that Samsung had unlawfully interrogated an employee regarding her protected activity. On February 3, 2016, the NLRB issued Order 363 NLRB No. 105, applying its decisions in D. R. Horton, Inc., 357 NLRB No. 184 (2012). In its Order, the NLRB affirmed Judge Biblowitz’s findings that the Samsung violated Section 8(a)(1) by maintaining and enforcing an arbitration agreement that requires employees, as a condition of employment, to waive their rights to pursue class or collective actions involving employment-related claims in all forums, whether arbitral or judicial. However, the NLRB reversed Judge Biblowitz’s ruling that Samsung had not unlawfully interrogated an employee about her protected, concerted activity. The appeal of this case was transferred from the 5th Circuit to the 11th Circuit on February 25, 2016.
Most recently, the Seventh Circuit, in Lewis v. Epic Sys. Corp., and the Ninth Circuit, in Morris v. Ernst & Young, adopted the NLRB’s position that mandatory arbitration agreements with concerted action waivers violate Sections 7 and 8 of the NLRA. However, the Fifth and Eighth Circuits have enforced mandatory arbitration agreements with class action waivers citing the Federal Arbitration Act. Murphy Oil, Inc. v. NLRB, 808 F.3d 1013 (5th Cir. 2015); Cellular Sales of Missouri, LLC v. NLRB, 824 F.3d 772 (8th Cir. 2016).
Stay tuned…