On January 13, 2017, the US Supreme Court agreed to determine whether arbitration agreements that include class action waivers are legally enforceable under the National Labor Relations Act (NLRA). In doing so, the Court granted the petitions for certiorari, and consolidated, three cases from the US Court of Appeals for the Fifth, Seventh and Ninth Circuits. While the Fifth Circuit has ruled that class action waivers are enforceable, the Seventh and Ninth Circuits have disagreed and held that class action waivers violate the NLRA. The National Labor Relations Board (NLRB) has also continued to hold that class action waivers violate the NLRA and interfere with employees’ rights to engage in concerted activity. A ruling by the Supreme Court on the issue should resolve the Circuit Court split, provide nationwide guidance, and end the patchwork approach that has been adopted by US employers who utilize arbitration and class waivers. The Supreme Court’s decision is expected before the end of June 2017.
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