U.S. Supreme Court Upholds Class Waivers In Workplace Arbitration Agreements Featured

  21 May 2018

The U.S. Supreme Court, in a highly anticipated case, ruled that employers can require as a condition of employment that workers waive their rights to participate in class action lawsuits as part of an arbitration agreement.

In a 5-4 ruling on a trio of cases written by Justice Neil Gorsuch, the court’s majority sided with employers whose  mandatory arbitration agreements contain waivers that prohibit class action lawsuits. Instead, workers who pursue litigation against an employer must do so as individuals, for most, but not all, types of claims. For example, in California, an arbitration agreement cannot include a representative PAGA claim, and workers’ compensation claims must be decided by the Workers’ Compensation Appeals Board.

In reaching its decision, the court noted, “The respective merits of class actions and private arbitration as means of enforcing the law are questions constitutionally entrusted not to the courts to decide…but to the policymakers in the political branches where those questions remain hotly contested … This court is not free to substitute its preferred economic policies for those chosen by the people’s representatives." Read more here.