Monday, March 17, 2014

Horton, Once Again

New ImageYet another development in the much-watched DR Horton case, see here and here, as the NLRB has petitioned for en banc review.  

As you may recall, the Board found the company's arbitration agreement to violate its employees' rights to engage in concerted action.  The more sweeping ground was that the mandatory arbitration agreement foreclosed any right to concerted dispute resolution because, in addition to cutting off any judicial forum, it barred class or collective arbitration. While the decision did not foreclose a ban on class arbitration per se, it did find impermissible provision that would bar any pursuit of concerted legal remedies.

A panel of the Fifth Circuit rejected this argument while upholding the Board's second, less dramatic ground -- that the arbitration agreement could be reasonably read by employees to bar resort to the Board itself for unfair labor practices. The panel decision was 2-1, Judge Graves dissenting as to the class dispute resolution issue.

The thrust of the Board's petition is relatively simple: the panel majority's reliance on Supreme Court cases rejecting attacks on arbitration  (Gilmer, Concepcion, Italian Colors) is mistaken because these cases did not involve any infringement on a substantive right, and the Horton arbitration agreement infringes on the core susbtantive right underlying the National Labor Relations Act -- the right of employees to act concertedly. 

Makes sense to me, but, then, I'm a pretty easy sell on this question!

CAS

 

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