Company can't ban employees from pursuing workplace claims as a class, 9th Circuit says
Federal labor law bars companies from requiring employees to give up their right to band together to pursue workplace claims, a federal appeals court has ruled.
The San Francisco-based 9th U.S. Circuit Court of Appeals ruled 2-1 for workers on Monday in an overtime-pay case against Ernst & Young, Reuters, Courthouse News Service and the Recorder (sub. req.) report.
Ernst & Young required employees to sign an agreement providing that any legal claims against the company would be resolved in arbitration and in “separate proceedings.” The workers had claimed the requirement for separate proceedings interfered with their right to engage in concerted activity under the National Labor Relations act.
Circuit Chief Judge Sidney Thomas wrote the majority opinion. “Concerted activity—the right of employees to act together—is the essential, substantive right established by the NLRA,” he wrote. The requirement for “separate proceedings” interfered with that right, he said.
Circuit Judge Sandra Ikuta dissented. “This decision is breathtaking in its scope and in its error; it is directly contrary to Supreme Court precedent and joins the wrong side of a circuit split,” Ikuta wrote.
The 9th Circuit joined the Chicago-based 7th U.S. Circuit Court of Appeals in striking down contract bans on collective claims by employees. Three other federal appeals courts have upheld them.
