The Supreme Court Says Yes to Arbitration and Class Action Waivers

With its 5-4 ruling in Epic Systems Corp. v. Lewis, the Supreme Court delivered a seemingly big win for employers. The Supreme Court held that employees’ waiver of their rights to bring collective or class actions, as a term of an arbitration agreement, is valid and enforceable. This ruling rejected the NLRB’s position that such waivers are invalid given the NLRA’s grant to employees of “the right . . . to bargain collectively through representatives of their own choosing, and to engage in other concerted activities for . . . mutual aid and protection.” A blog post on Declassified provided a legal analysis of the Epic Systems opinion from a class action—as opposed to employment—standpoint. The Supreme Court has now definitively resolved that employers can use arbitration agreements to prevent employees from bringing a collective action.

But Corporate America Is Conflicted

Does This Arbitration Agreement Make Me Look Sexist? <i>The Moving Target of Using Arbitration Clauses</i>Ironically, at the very moment the Supreme Court has made it easier for employers to double down on arbitration agreements, some businesses are making headlines by curtailing arbitration terms for certain claims. It’s safe to say that the #MeToo movement has something to do with it.

Last week, after months of scrutiny and negative publicity, Uber announced that it would “no longer require mandatory arbitration for individual claims of sexual assault or sexual harassment by Uber riders, drivers or employees.” As NPR reported, Uber’s new policy does not apply to claims brought as class actions.

Uber wasn’t the first to take this step. In December 2017, Microsoft publically endorsed legislation that would protect sexual harassment victims’ ability to bring a case in court instead of in arbitration where they could be prohibited from speaking of the incident. In the same statement, Microsoft announced its own new policy and waived its contractual requirements for arbitration of sexual harassment claims.

Even some law firms have had to adapt their employment agreements in the wake of #MeToo. Posts of Munger Tolles & Olson’s summer employment contract, which effectively mandated arbitration for harassment claims, garnered unwanted attention on social media. In response, the firm released its own tweet statement that it would “no longer require any employees, including summer associates, to sign any mandatory arbitration agreements.”

#arbitrationwhatnow?  

While employers have weighed the costs of arbitration versus litigation for decades, the current environment requires new considerations. Are the cost savings of an arbitration agreement (including the ability to maintain confidentiality and prevention of class claims) worth the risk of a social media firestorm? Should you carve out individual harassment claims from mandatory arbitration (ala Uber) or risk class treatment, and carve out all harassment claims (ala MicroSoft)? In the throes of #MeToo, it’s important to consider these new costs and benefits. A simple test: If you wouldn’t want it to go viral on Twitter, reconsider.

Happy Thanksgiving and the Many Things for Which We Are ThankfulBefore everyone gets out of the office to their various homes and families to celebrate the holiday, we wanted to review the year and count our blessings. Not only are we thankful that our families and colleagues in our Houston and Tampa offices weathered the storms safely, we are also thankful for the following legal stuff:

1. The DOL is not about to change the wage and hour laws.

Does anyone else remember the panicked calls last Thanksgiving week when the Texas judge put the brakes on a regulation that was going to increase the salary basis test? We are all thankful that will not happen this year. Although we still don’t know what, if anything, will happen on that front we will keep you posted.

2. Finally a court has said the ADA is not about leave.

Despite the EEOC’s insistence otherwise, the Seventh Circuit stepped up to the plate and said extended leave is not a reasonable accommodation under the ADA. As we all know, you still need to consider if a limited amount of leave will get the employee back to work but we are thankful that we have some new case law on this front.

3. Harvey Weinstein doesn’t work for us.

This story has horrified many but given all employers a wake-up call. We are grateful for the opportunity to train more people and try to make America a better place to work.

4. The NLRB has a new direction.

Maybe the new Board won’t tell employees that it is okay to swear at your boss on Facebook or nitpick employer policies quite so much.

5. You’re not going to be the employer of someone else’s employees.

DOL has withdrawn its prior guidance on independent contractor and joint employer liability, and Alabama’s Rep. Byrne has introduced a bill to “Save Our Small Businesses.”

6. Legalized marijuana has made questions about drug policies so much more interesting.

Even though it isn’t legal in many states, the fact that employees can legally ingest marijuana many places (including Florida) and take their chances on the looming random drug screen has spiced up our lives. While the law will continue to develop in this area, we are grateful for the very interesting questions we have received.

7. People other than our mothers read this blog.

(Okay, some of our moms are reading and might boost the numbers a little bit.) Since 2016, we have published more than 130 articles and had more than 230,000 reads, according to aggregate reports from Lexology and JD Supra. We have received recognition in The Expert Institute’s Best Legal Blog 2017 competition, the ABA Journal’s Web 100 Ranking, and numerous quotations in other publications. We enjoy bringing you this information and love it when you tell us it is helpful or tweet it to someone else.

Happy Thanksgiving from the Labor & Employment Insights blog team!

Around the end of October, a photo of a government contractor employee flipping the bird to President Trump’s motorcade went viral after the woman made it her profile picture on Facebook. She was subsequently fired for a violation of her company’s social media policy. The company said that the image was “lewd” and “obscene.” The woman argued that she was not at work when the photo was taken and did not mention her employer in the post. No litigation or charges have been filed yet, but would they be successful?

Can an Employer Regulate Political Social Media Speech?

Flipping Out Over Flipping Off: What Are the Limits on Regulating Employee Political Speech?

What comes to most people’s mind when reading this type of scenario is the First Amendment guarantee of free speech. However, the First Amendment protects against governmental censorship of speech. With some restrictions, a private employer can restrict speech in the workplace. This right to restrict also may be extended to social media speech, especially when the employer has a written social media policy and if the employee is using employer-provided equipment (cell phone or computer) to engage in the speech. Coupled with the fact that many states are “at-will” employment states, it may be perfectly acceptable for an employer to terminate an employee who engages in speech that the employer finds offensive or non-productive.

One complication outside of the First Amendment is the National Labor Relations Board’s recent decisions that employees cannot be restricted from commenting on social media about their conditions of employment. The NLRB considers such comments to be “concerted protected activity” for which an employer may not retaliate. However, as seen here, there may be social media posts that have nothing to do with the conditions of the workplace, but that the employer doesn’t like. For those posts, discipline or termination may be an option.

This story is a good prompt for employers to review their social media policies and to talk about them with their employees. Remind employees that, although they may not expressly identify each post with the place they work, they still may be considered the face of the organization. Political discussions are not per se taboo—but the tone and language used may sometimes stray into offensive territory. As always, an open dialogue about employment policies usually results in happier employees and less difficult situations.