Epic Systems v. Lewis - Foundations of Law and Dispute Resolution

Question 1

Facts

Answer 1

3 factually similar cases were consolidated. In one of them, EY gave its accountant a take-it-or-leave arbitration agreement that req’d all fed & state statutory wage claims to be arbitrated individually. He continued to work there, indicating his assent to the agreement. After leaving EY, the accountant filed a class action against EY in court for violations of Fair Labor Standards Act (FLSA) (no overtime pay).

Question 2

Procedural History

Answer 2

EY moved to compel individual arbitration. Accountant claimed that Sec. 7 of Nat’l Labor Relations Act (as interpreted by recent NLRB Decision) created a substantive and unwaiveable right to employee “concerted activity for the purpose of collective bargaining, or other mutual aid or protection” which included the right to collective litigation

Question 3

Issue

Answer 3

Does Sec. 7 of NLRA give workers a substantive right to collective litigation, such that employer/employee arbitration agreements that waive such right are unenforceable notwithstanding FAA?

Question 4

Holding

Answer 4

Contracts in which employees give up right to collective litigation against employer are ok.

Question 5

Reasoning

Answer 5

Congress expressed a “liberal federal policy favoring arbitration agreements” in the FAA. By contrast, the NLRA mentions “concerted action” but is silent on workers’ rights to collective litigation. Court must reconcile the two, and therefore NLRA should be interpreted not to interfere with enforceability of arbitration agreements under FAA.

Question 6

Business Takeaway

Answer 6

Courts will generally be in favor of agreed arbitration clauses “therefore NLRA should be interpreted not to interfere with enforceability of arbitration agreements under FAA”