Workforce Bulletin

Employers in the First Circuit know that unconscionability challenges to employment arbitration agreements are commonplace. In Trainor v. Primary Residential Mortgage, Inc., the U.S. District Court for the District of Rhode Island recently addressed an employee’s arguments that an agreement’s venue clause requiring a Rhode Island employee to arbitrate her claims in Utah and a provision excluding certain claims from the scope of the arbitration agreement rendered the arbitration agreement unconscionable and unenforceable. The court rejected the first argument based ...

Following are the top stories featured in this week's #WorkforceWednesday, from Employment Law This Week:

Employee Travel and the Coronavirus

The threat of COVID-19 is growing, and U.S. companies are on high alert. International travel by employees is an area of particular concern to employers. For more, check out our resource center at https://www.ebglaw.com/coronavirus.

NLRB Joint-Employment Rule to Take Effect

The National Labor Relations Board ...

Our colleague Steven M. Swirsky, a Member of the Firm at Epstein Becker Green, has a post on the Management Memo blog that will be of interest to many of our readers in the technology industry: “Federal Appeals Court Sides with NLRB – Holds Arbitration Agreement and Class Action Waiver Violates Employee Rights and Unenforceable.”

Following is an excerpt:

The US Court of Appeals for the Seventh Circuit in Chicago has now sided with the National Labor Relations Board (NLRB or Board) in its decision in Lewis v. Epic Systems Corporation, and found that an employer’s arbitration ...

Our colleague Steven M. Swirsky, a Member of the Firm at Epstein Becker Green, has a post on the Management Memo blog that will be of interest to many of our readers in the financial services industry: “Federal Appeals Court Sides with NLRB – Holds Arbitration Agreement and Class Action Waiver Violates Employee Rights and Unenforceable.”

Following is an excerpt:

The US Court of Appeals for the Seventh Circuit in Chicago has now sided with the National Labor Relations Board (NLRB or Board) in its decision in Lewis v. Epic Systems Corporation, and found that an employer’s ...

Our colleague Steven M. Swirsky, a Member of the Firm at Epstein Becker Green, has a post on the Management Memo blog that will be of interest to many of our readers in the retail industry: “Federal Appeals Court Sides with NLRB – Holds Arbitration Agreement and Class Action Waiver Violates Employee Rights and Unenforceable.”

Following is an excerpt:

The US Court of Appeals for the Seventh Circuit in Chicago has now sided with the National Labor Relations Board (NLRB or Board) in its decision in Lewis v. Epic Systems Corporation, and found that an employer’s arbitration ...

Our colleague Steven M. Swirsky, a Member of the Firm at Epstein Becker Green, has a post on the Management Memo blog that will be of interest to many of our readers in the hospitality industry: “Federal Appeals Court Sides with NLRB – Holds Arbitration Agreement and Class Action Waiver Violates Employee Rights and Unenforceable.”

Following is an excerpt:

The US Court of Appeals for the Seventh Circuit in Chicago has now sided with the National Labor Relations Board (NLRB or Board) in its decision in Lewis v. Epic Systems Corporation, and found that an employer’s arbitration ...

By John F. Fullerton III and Jason Kaufman

In its recent decision in Santoro v. Accenture Federal Services, LLC [pdf], the Fourth Circuit Court of Appeals has joined the Fifth Circuit [pdf] in narrowly interpreting the prohibition against predispute arbitration agreements in the Dodd Frank Wall Street Reform and Consumer Protection Act of 2010 (“Dodd-Frank”) -- and employers can breathe a further sigh of relief.

Dodd-Frank amended the Sarbanes-Oxley Act (“SOX”) to, among other things, prohibit agreements requiring predispute arbitration of SOX claims (see 18 ...

By John F. Fullerton III and Jason Kaufman

Almost four years after it was enacted in 2010, the full impact of the Dodd Frank Wall Street Reform and Consumer Protection Act (“Dodd-Frank”) on the enforceability of predispute arbitration agreements is not completely clear.  Some whistleblower retaliation claims are still subject to mandatory arbitration agreements, while others plainly are not, depending upon when the arbitration agreement was executed, the statute under which the claim is brought, and the jurisdiction in which the employer and employee find themselves.

By Amy Messigian

Last month, the California Court of Appeal ruled that a former employee of Forever 21 must try her claims against the retailer in arbitration, enforcing the company’s employment arbitration policy and reversing a lower court decision finding the agreement unconscionable under California law.  The plaintiff, Maribel Baltazar, alleged that she had been discriminated against by the retailer due to her race and sexually harassed by a supervisor and coworker.  She filed a complaint against Forever 21 and several of its employees in the Los Angeles Superior Court and ...

By William Stein

In rolling out arbitration policies, retail employers should heed the recent California Court of Appeal decision Gorlach v. The Sports Club Co. That case gives employers reason to be cautious when asking employees to sign agreements requiring them to arbitrate any disputes arising out of their employment.  In that case, the trial court found the former Director of Human Resources, who was responsible for obtaining employees’ signatures on a mutual agreement to arbitrate claims, intentionally misled the company into believing that had signed the agreement ...

By:  John F. Fullerton III

This is the third in our series of posts on practice and procedure in employment-related arbitrations before FINRA.  Check back often for future posts, subscribe by e-mail (see the sidebar), or follow @FSemployer on Twitter so you don’t miss any updates!

Once upon a time, it was mandatory under Form U4 that registered representatives file any statutory claims of discrimination (such as age, gender, or race discrimination) in arbitration rather than in court.  A well known Supreme Court case decided in 1991, Gilmer v.  Interstate/Johnson Lane Corp.

By:  John F. Fullerton III

This is the second in our series of posts on practice and procedure in employment-related arbitrations before FINRA.  Check back often for future posts, subscribe by e-mail (see the sidebar), or follow @FSemployer on Twitter so you don’t miss any updates!

As a general rule, it is more common to read about employers who have been sued in court by a former employee attempting to compel the claims into arbitration than an employer trying to compel arbitration claims to be filed in court.  Yet, under the occasionally overlooked FINRA Rule 13803, employers who ...

By:  Dena L. Narbaitz

Here is the scenario:  your company, a FINRA Member Firm, terminates a broker for “violation of company policies” and reports this as the reason for termination on the broker’s Form U-5 (Uniform Termination Notice for Securities Industry Registration).  The broker then sues your company in state court asserting several claims, including defamation for the language contained on his Form U-5.  Your company thinks there is a good legal basis to have the broker’s claims dismissed as a matter of law before the case is tried.  Should your company litigate the case ...

Like several other statutes, the Sarbanes-Oxley Act (“SOX”) requires whistleblowers to initiate their complaints by an administrative filing with the Department of Labor’s Occupational Safety and Health Administration. But when a preferred outcome in that designated arena appears unlikely, a whistleblower may be allowed to abandon the administrative process before a final order issues and seek a new opportunity in court.  Faced with the prospect of another round of de novo litigation, employers may turn increasingly to pre-dispute arbitration agreements as an alternative to litigating in court.

As exemplified by Stone v. Instrumentation Laboratory Co.(4th Cir. 2009) (pdf), filing an administrative complaint and participating in the administrative process, as required by SOX, do not foreclose access to a federal court before the issuance of a final administrative order. The court explained that the preclusion doctrine, intended to avoid duplicative litigation, does not bar de novo consideration by a federal district court if a lawsuit is filed at least 180 days after the administrative filing and before the Department of Labor has issued a final decision, even where administrative proceedings have progressed to Administrative Review Board consideration of an administrative law judge’s dismissal of a complaint.