Sunday, January 8, 2012
The National Labor Relations Board ruled Friday in the D.R. Horton case that employers violate NLRA Section 8(a)(1) by requiring employees to sign arbitration agreements that prevent them from joining together to pursue employment-related legal claims in any forum, whether in arbitration or in court. From the Board's press release:
The decision examined one such agreement used by nationwide homebuilder , under which employees waived their right to a judicial forum and agreed to bring all claims to an arbitrator on an individual basis. The agreement prohibited the arbitrator from consolidating claims, fashioning a class or collective action, or awarding relief to a group or class of employees
The Board found that the agreement unlawfully barred employees from engaging in “concerted activity” protected by the National Labor Relations Act. The Board emphasized that the ruling does not require class arbitration as long as the agreement leaves open a judicial forum for group claims.
I think this is huge and that it is exactly the right decision, for the same reasons I thought the Supreme Court got the consumer class-action ban issue wrong in AT&T Mobility v. Concepcion. Unfortunately, I would assume this will not be the last we will see of this issue.