U.S. Chamber Urges SCOTUS To Review NLRB's D.R. Horton Rule Prohibiting Arbitration in Employment
Whether arbitration agreements with individual employees that bar them from pursuing work-related claims on a collective or class basis in any forum are prohibited as an unfair labor practice under 29 U.S.C. § 158(a)(1), because they limit the employees' right under the National Labor Relations Act to engage in "concerted activities" in pursuit of their "mutual aid or protection," 29 U.S.C. § 157, and are therefore unenforceable under the saving clause of the Federal Arbitration Act, 9 U.S.C. § 2.
The U.S. Chamber filed an amicus brief urging the U.S. Supreme Court to review the question whether individual arbitration agreements protected by the Federal Arbitration Act ("FAA") are, nonetheless, prohibited in the employment context under the National Labor Relations Act ("NLRA"). Adoption of the anti-arbitration view by a few courts—a view first embodied in the National Labor Relations Board's ("NLRB") D.R. Horton decision—has produced an untenable split among the lower courts and is of broad national importance, implicating employment contracts involving millions of employees.
The issue is now presented in multiple certiorari petitions before the Court. The Chamber urged the Court, regardless of whether it grants the NLRB's petition, to grant employers' petitions to get a full airing of the issues. The Chamber also explained three distinct issues that the Court must address to fully resolve the conflict among the lower courts:
(1) Does the NLRA contain a "contrary congressional command" overriding the FAA?
(2) Does enforcing the arbitration agreement waive a right to pursue statutory remedies under the NLRA?
(3) Is the D.R. Horton rule a basis "at the law or in equity for the revocation of any contract"?
This case is part of a series of cases in which parties, including the NLRB as a party or amicus, continue to press the NLRB's position, first announced in the D.R. Horton matter, that agreements between employers and employees to arbitrate disputes on an individual basis violate the NLRA.
This case has not been decided on the merits.
U.S. Chamber amicus brief filed 10/11/2016.
Cert. granted 1/13/17.