Earlier this week, the U.S. Supreme Court issued a 5–4 decision in Epic Systems Corp. v. Lewis that companies can use arbitration clauses in employment contracts to prevent workers from suing them collectively.
Epic Systems revolves around a group of employees who sued their employers for “wage theft,” alleging that they were underpaid illegally. While each of the workers’ individual claims is fairly small and probably not worth the cost of litigation, the claims together add up to a substantial sum. As such, the employees filed a class action on behalf of themselves and others who were similarly wronged. Epic Systems fought their lawsuits, arguing that the Federal Arbitration Act blocked their claims because the workers had signed contracts that waived their right to sue and compelled individual arbitration instead.
In the opinion, Justice Neil M. Gorsuch wrote that federal law favors arbitration and that if workers sued collectively, “the virtues Congress originally saw in arbitration, its speed and simplicity and inexpensiveness, would be shorn away and arbitration would wind up looking like the litigation it was meant to displace.”
See Epic Systems Corp. v. Lewis on Justia Supreme Court Center.
Supreme Court Upholds Workplace Arbitration Contracts Barring Class Actions, New York Times May 21, 2018
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