Ninth Circuit Rejects Argument That Employment Arbitration Agreement With Class Action Waiver Violates the National Labor Relations Act
In 2011, the U.S. Supreme Court had ruled in AT&T Mobility LLC v. Concepcion, 131 S. Ct. 1740 (2011), that arbitration agreements with class waivers were permissible. Then, just after employers thought it safe to create arbitration agreements requiring employees to waive class actions, the National Labor Relations Board (“NLRB”) threw a fly in the ointment, ruling in a case called D.R. Horton (involving the national developer and home builder) that arbitration agreements with class action waivers create an unfair labor practice because they restrict employees from engaging in protected concerted activity. D.R. Horton, 357 NLRB 184 (Jan 3, 2012). This NLRB ruling applied equally to unionized workplaces and those without unions. Until now, employers under the Ninth Circuit’s jurisdiction have not had much guidance on handling the apparent conflict between the Supreme Court’s embrace of class action waivers in AT&T Mobility and the NLRB’s rejection of them in D.R. Horton.