The Epic Systems Decision: Where Do Employers Go from Here?

Emery Gullickson Richards

The U.S. Supreme Court’s decision in Epic Systems Corp. v. Lewis has significant ramifications for the scope of class action waivers in employee arbitration agreements. In each of the three consolidated cases that the Court’s opinion addressed, the plaintiffs were pursuing class/collective actions with Fair Labor Standards Act (“FLSA”) claims for unpaid overtime. Plaintiff Sheila Hobson’s FLSA claim in the Murphy Oil case had been dismissed by the trial court as a result of the arbitration provision in the employment agreement she signed when she started work at a gas station in Alabama. By contrast, plaintiff Jacob Lewis, a technical communications employee, had overcome a motion to dismiss his FLSA overtime class action in the Epic Systems case by arguing that a class action waiver in an arbitration agreement that had been emailed to him by his employer was unenforceable. In the Ernst & Young case, plaintiff Stephen Morris sought unpaid overtime under the FLSA and the California Labor Code for working long hours during audit season. As a result of the Supreme Court’s ruling, after remand, all of these claims now appear destined for arbitration unless they are resolved. The Epic Systems decision represents a broader affirmation, however, that arbitration agreements are enforceable regardless of the nature of an employee’s claim, even if the claims are brought pursuant to employment statutes that explicitly provide for class or collective actions. Continue reading “The Epic Systems Decision: Where Do Employers Go from Here?”

Epic Shift: Supreme Court Enforces Class Action Waivers in Arbitration Agreements

Emery Gullickson Richards

The Supreme Court issued a landmark decision on May 21, 2018, which has widespread implications for all employers. In Epic Systems Corp. v. Lewis, a 5-4 opinion written by Justice Gorsuch, the Supreme Court held that arbitration agreements and class/collective action waivers are enforceable, putting to rest any argument that the National Labor Relations Act prevents or limits their enforceability. The decision provides employers further options for limiting litigation risk, particularly with respect to costly wage and hour collective actions. The decision also contains important implications for employers that maintain or are considering implementing arbitration agreements in the workplace, as there is no longer any identified legal impediment to the concept of an employer requiring its employees to waive the ability to bring a class or collective action under federal, state, and local employment laws. Continue readingEpic Shift: Supreme Court Enforces Class Action Waivers in Arbitration Agreements”