As we wrote about last month, on May 21, 2018, the Supreme Court rendered its decision in Epic Systems Corp. v. Lewis, 138 S. Ct. 1632 (2018), rejecting perhaps the largest remaining obstacles to the enforcement of class action waivers in arbitration agreements in the employment context. The Court concluded that the class action waivers did not violate the National Labor Relations Act (“NLRA”). Although the Court’s opinion also seemed dispositive of whether such agreements could be avoided under the Fair Labor Standards Act (“FLSA”), at least one claimant tried to continue to litigate the issue, which was disposed of last week in Gaffers v. Kelly Servs., Inc., No. 16-2210 (6th Cir. 2018). And now the Sixth Circuit has addressed whether Epic Systems would apply to arbitration agreements with putative independent contractors who contended that they should have been treated as employees.
Andrea Mickles filed a complaint against her employer Country Club Inc., alleging it had violated the Fair Labor Standards Act (FLSA) by improperly classifying her and other employees as independent contractors and failing to pay them minimum wage and overtime. She filed her case as a collective action, and others opted into the case before any ruling on conditional certification. Those opt-ins eventually provided the Eleventh Circuit with an opportunity to address an issue of first impression in any Circuit: What is the status of individuals who opt into a case that is never conditionally certified? Continue Reading Who’s Invited to the Party?: The Status of Collective Action Opt-Ins
With its May 26 Lewis v. Epic-Systems Corp. decision, the Seventh Circuit became the first circuit to back the reasoning in D.R. Horton, Inc., 357 NLRB No. 184 (2012), and held that a mandatory arbitration agreement prohibiting employees from bringing class or collective actions against their employer violates the National Labor Relations Act (NLRA). This decision creates a circuit split regarding the enforceability of arbitration agreements with class action waivers in the employment context, and the issue is now ripe for potential Supreme Court review.
In a move that could significantly increase the cost and expense of defending a Fair Labor Standards Act (“FLSA”) collective action, a federal district court Judge has dispensed with the traditional method for joining putative class members in an FLSA collective action. The Judge is going to permit employees to join if they submit a notice. Such a move could lead to more protracted litigation and will certainly be appealed. In Turner, et al. v. Chipotle Mexican Grill, Inc., No. 1:14-cv-02612, Senior U.S. District Judge John L. Kane of the U.S. District Court for the District of Colorado granted the plaintiffs’ motion for conditional certification and judicial notice to the class. The case involves plaintiffs’ wage and hour claims against Chipotle under the Fair Labor Standards Act and the state laws of Arizona, California, Colorado and New Jersey. That the plaintiffs’ motion was granted is not, in and of itself, notable. But what is remarkable is the procedure applied for those who would seek to join the suit.