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NLRB Decides First Mandatory Arbitration Case Following Supreme Court’s Epic Systems Ruling

WASHINGTON, DC—The National Labor Relations Board addressed several important questions involving mandatory arbitration agreements following the Supreme Court’s Epic Systems decision.  Specifically, the Board held:

  • Employers are not prohibited under the National Labor Relations Act (NLRA) from informing employees that failing or refusing to sign a mandatory arbitration agreement will result in their discharge. 
  • Employers are not prohibited under the NLRA from promulgating mandatory arbitration agreements in response to employees opting in to a collective action under the Fair Labor Standards Act or state wage-and-hour laws. 
  • Employers are prohibited from taking adverse action against employees for engaging in concerted activity by filing a class or collective action, consistent with the Board’s long-standing precedent. 

Today’s decision, Cordúa Restaurants, Inc., 368 NLRB No. 43 (2019), was the first to address the lawfulness of employer conduct surrounding mandatory arbitration agreements since the Supreme Court’s Epic Systems ruling issued in 2018.  In Epic Systems v. Lewis, the Court held that class- and collective-action waivers in mandatory arbitration agreements do not violate the NLRA.   ­­­­­­­­­­

Chairman John F. Ring was joined by Members Marvin E. Kaplan and William J. Emanuel in the majority opinion.  Member Lauren McFerran dissented in part. 

Established in 1935, the National Labor Relations Board is an independent federal agency that protects employers and employees from unfair labor practices and protects the right of private sector employees to join together, with or without a union, to improve wages, benefits and working conditions. The NLRB conducts hundreds of workplace elections and investigates thousands of unfair labor practice charges each year.

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