The US Supreme Court ruled on May 21 in Epic Systems Corp. v. Lewis that class and collective action waivers in employment arbitration agreements are enforceable under the Federal Arbitration Act (FAA). The court sided with employers, rejecting arguments that class and collective action waivers were unenforceable because they violated the National Labor Relations Act (NLRA).
The employees argued that the FAA’s saving clause provided a basis for courts to refuse to enforce arbitration agreements that also include a waiver of the right to bring a class or collective action, because such waivers violate the NLRA. The employees also argued that the NLRA itself reflected a clearly expressed and manifest congressional intention to displace the FAA and bar class and collective action waivers, because the NLRA guarantees workers the right to engage in concerted activities for the purpose of collective bargaining or other mutual aid or protection. The Supreme Court rejected each of these arguments, finding that the NLRA does not contain a conflicting congressional command, and instead can be harmonized with the FAA to permit class and collective action waivers in employment arbitration agreements.