Epic Systems Corp. v. Lewis
Issues
Does the National Labor Relations Act prohibit the enforcement of agreements between employers and employees requiring individual employees to waive the right to participate in collective litigation, collective actions, and collective arbitration under the Federal Arbitration Act?
At issue in this case is whether employment contracts barring employees from collectively arbitrating disputes with employers are illegal under the National Labor Relations Act (“NLRA”). Employees argue that preventing collective arbitration interferes with the NLRA’s Section 7 protections of “concerted activity” for “mutual aid and protection”. Employers counter that the Federal Arbitration Act governs the arbitration agreements, under which they are enforceable. Employers also contend that enforcing the agreements protects freedom of contract, thus promoting efficiency and protecting judicial resources. Employees respond that collective arbitration allows them to share the costs and risks of litigation, thereby allowing them to pursue claims that, in the aggregate, may reveal abusive practices by employers. One on hand, freedom of contract in the interest of judicial economy may be harmed if the Court does not uphold the validity of the waivers. On the other hand, if the Court does uphold the validity of the waivers, it will may become more difficult for employees to challenge abusive work practices in their workplaces.
Questions as Framed for the Court by the Parties
Whether the collective-bargaining provisions of the National Labor Relations Act prohibit the enforcement under the Federal Arbitration Act of an agreement requiring an employee to arbitrate claims against an employer on an individual, rather than collective, basis.
The Court here considers three consolidated cases: Epic Systems Corp. v. Lewis, Ernst & Young, LLP v. Morris, et al., and National Labor Relations Board (“NLRB”) v. Murphy Oil USA, Inc. Epic Systems, Ernst & Young, and Murphy Oil (“Employers”) urge the Court to uphold class action and collective arbitration waivers between employers and employees.
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Additional Resources
- Marcia Coyle, Flip a Coin? Lawyers Maneuver in Key Labor Case at Supreme Court, The National Law Journal (August 22, 2017).
- John B. Lewis & Dustin M. Dow, Lewis v. Epic Systems Opinion – Seventh Circuit Swimming Against the Tide in Mandatory Individual Arbitration, Lexology (May 31, 2016).
- Lewis v. Epic Systems Corp.: Seventh Circuit Invalidates Collective Action Waivers in Employment Arbitration Agreements, Harvard Law Review (Jan. 5, 2017).
- Gordon W. Renneisen, Lewis v. Epic Systems: An Ongoing Debate Over Class Waivers, Law360 (June 13, 2016).