One of the top stories featured on Employment Law This Week: The U.S. Court of Appeals for the Seventh Circuit has joined the National Labor Relations Board in finding that arbitration agreements containing class action waivers violate the National Labor Relations Act (NLRA).
At issue is a collective and class action by employees of Epic Systems about overtime pay. The company was seeking to dismiss the case based on a mandatory arbitration agreement that waived an employee’s right to participate in a collective or class action. Unlike the Fifth Circuit, the Seventh Circuit found that a class-action waiver like this one violates the NLRA and, because the contract is unlawful, its enforcement is not required by the Federal Arbitration Act. The Seventh Circuit’s decision creates a split in the federal circuits that means that the U.S. Supreme Court will likely weigh in on the issue.
View the episode below or read more about this story in a previous blog post by Steve Swirsky.