Tragedy of the Commonality: A Substantive Right to Collective Action in Employment Disputes †

By Stephens, Spencer | Emory Law Journal, January 1, 2017 | Go to article overview

Tragedy of the Commonality: A Substantive Right to Collective Action in Employment Disputes †


Stephens, Spencer, Emory Law Journal


INTRODUCTION

Labor law is in the midst of a rapid transformation.1 Stemming from the rise of right-to-work laws and the decline in representation by formalized unions, employees are increasingly dependent on individual protections afforded by federal law.2 During this shift, economic inequality has increased between employers and employees.3 Furthermore, workers continue to lose influence not only in their individual workplaces, but also at the legislative policymaking level.4 Employers and businesses have capitalized on this climate by expanding the use of mandatory, individual arbitration agreements to shield themselves from collective liability.5 The Supreme Court memorably endorsed the use of this arbitration tactic in the interstate commercial sphere by stating, "States cannot require a procedure that is inconsistent with [arbitration], even if it is desirable for unrelated reasons."6 Modern courts facing arbitration agreements, irrespective of conflicting statutory rights, generally feel compelled to enforce them.7

The Seventh Circuit in Lewis v. Epic Systems Corp. rebuffed the escalating trend of individual arbitration agreements restricting employment rights.8 The Court reasoned that the National Labor Relations Act (NLRA) provides an employee the substantive right to collective action if the employee is "engage[d] in concerted activities . . . intend[ing] to induce group activity" against an employer to equalize the inequality of bargaining power between the parties.9 This right invalidates arbitration agreements requiring the waiver of all collective representation as an unfair labor practice.10 The court, recognizing the threat to employment rights from the Supreme Court's expanded scope of the Federal Arbitration Act (FAA), stated the two statutes do not irreconcilably conflict.11 In particular, the FAA's policy of liberally enforcing arbitration agreements could not validate an otherwise illegal arbitration agreement.12

The Lewis majority further noted that its decision diverted from decisions by various federal circuit courts and the Supreme Court.13 In the wake of Lewis, both commentators and lower courts have struggled to reconcile existing law without overturning precedent.14 This has created a vast federal circuit split, pitting the Sixth, Seventh, and Ninth Circuits against the Second, Fifth, and Eighth Circuits.15 This circuit split has produced uneven results leading to unjust infringements upon the substantive rights of employees.16 Since the Supreme Court has decided to resolve the conflict, collective action waivers in individual arbitration agreements are primed to occupy the national spotlight during the 2017-2018 term.17

The impending Supreme Court decision will have far-reaching implications on the future of labor law and may radically transform employment relations. There is an inherent imbalance of bargaining power present in every employment contract, as the employer has the power to dictate the terms and policies of employment, as well as the method to resolve disputes.18 Individual workers, regardless of their education or skill level, possess meager and insufficient power to challenge an employer and enact changes in the workplace.19 Left to their own devices, employees are routinely subjected to adhesion contracts, misclassification of employment duties and obligations, lost wages, and unsafe working conditions.20 These examples demonstrate the importance of an employee's ability to band together with similarly situated coworkers in a collective action against an employer. This represents the only effective method to equalize the parties' bargaining powers and enact changes in the workplace.

This Comment argues that the protections afforded by Congress in Section 7 of the NLRA include the right of employees to join together in collective suits against an employer. An employer cannot force an employee to waive this substantive right by requiring individual arbitration to resolve disputes. …

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