The Ninth Circuit recently found unenforceable a class (or “collective”) action waiver requiring employees to arbitrate their claims individually. In other words, requiring class action waivers as a condition of hire or continued employment violates the National Labor Relations Act (NLRA). The NLRA applies to both unionized and many private, non-unionized workforces and protects covered employees’ rights to engage in concerted activity for the purpose of mutual aid or protection.
The facts of the case, Morris v. Ernst & Young, are as follows: An employee filed a class action in federal court claiming that Ernst & Young misclassified employees to avoid paying overtime. Another employee proceeded to join the case. This was despite agreements signed by the employees stating that the employees must pursue any and all claims against their employer in individual (and not class or collective) arbitration proceedings. The federal district court ordered the two employees’ claims to individual arbitration, and the employees appealed.Details