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Employment Law Newsletter

The NLRA posting requirement discussed above is only one of several recent actions taken by the NLRB that serve as a sober reminder that even in non-unionized workplaces, private sector employees have statutory rights under Section 7 of the NLRA to engage in concerted activity for, among other things, “mutual aid and protection.”

In its January 3, 2012, ruling in (NLRB Case 12-CA-25764), the Board considered whether a requirement that employees execute arbitration agreements that waived employees’ rights to any judicial forum in favor of arbitration, and further, prohibited the arbitrator from fashioning a collective or class action, violated employees’ Section 7 rights to engage in concerted action for mutual aid and protection. The Board concluded that such arbitration agreements unlawfully restrict employees’ rights to collectively pursue employment-related claims, notwithstanding the Federal Arbitration Act (FAA), which generally makes employment-related arbitration agreements judicially enforceable. Some commentators view this decision as a repudiation of the U.S. Supreme Court’s 2011 decision in , which held that the FAA pre-empted California state law barring arbitration agreements from prohibiting class-action lawsuits.

Under this ruling, employers remain free to enter into mandatory arbitration agreements, so long as the agreement carves out an exception permitting employees to pursue group claims in a judicial or other forum. Employers should review their arbitration agreements with employment law counsel to assess how the NLRB’s ruling affects the enforceability of those agreements.