Supreme Court Upholds Validity of Employee Class Action Waivers

Q.  Can my company require its employees to sign an arbitration agreement mandating that they arbitrate all employment disputes, and limiting their ability to participate in a class action against the company?

A.  On May 21, in a 5-4 opinion, the U.S. Supreme Court ruled that arbitration agreements in which an employee waives the right to pursue his or her employment claims in a class or collective action are enforceable under the Federal Arbitration Act (FAA). The holding in Epic Systems Corp. v. Lewis, No. 16-285, resolves a circuit court split on whether class action waivers in arbitration agreements violate the National Labor Relations Act (NLRA). Justice Gorsuch delivered the opinion of the Court, rejecting three primary arguments made by employees to undermine the validity of class action waivers under the FAA.

For more information about this case, please click here.

-Tracey E. Diamond