Thursday, May 3, 2012

The NLRB’s dangerous course: arbitration waivers and protected concerted activity

The NLRB has announced the filing of a complaint against 24 Hour Fitness USA, Inc., claiming that the company’s requirement that its employees submit all employment-related disputes to individual arbitration violated federal labor law.

According to the NLRB, 24 Hour Fitness, which is non-unionized, requires employees to agree, in writing and as a condition of employment, to forego any rights to collective or class action lawsuits or arbitrations, and instead resolve all employment dispute in single-employee arbitrations. The company permits employees to opt-out of this waiver, but only by submitting a company-drafted written form within 30 days of signing the original waiver.

Earlier this year—in D. R. Horton, Inc. (currently on appeal)the NLRB held that an employer violated the federal labor law by maintaining, as a condition of employment, a mandatory arbitration agreement that did not allow its employees to file joint, class, or collective employment-related claims in any forum, arbitral or judicial. In 24 Hour Fitness, the Board seeks to extend D. R. Horton to include the 30-day opt-out. As is the case with social media, the NLRB is expanding its attacks on workplace policies in non-unionized workplaces.

I’ll give NLRB Acting General Counsel Lafe Solomon credit—he has taken an agency that had been relegated to near-obsolescence and made it very relevant. Less than 7 percent of private-sector workers belong to a labor union. By shifting its enforcement priorities to issues surrounding protected concerted activity, the NLRB has extended its reach to the 93 percent of non-unionized workers. It has also made itself the go-to agency for employees fired for complaining about work.

This focus by the Board on protected concerted activity is only going to increase. According to Mr. Solomon’s latest memo [pdf] (discussing his attendance at the Midwinter meeting of the Practice and Procedure Committee of the ABA Labor and Employment Law Section), the NLRB will be adding a page to its website “dedicated to Protected Concerted Activity matters.” In other words, businesses need to prepare themselves for increased knowledge by their employees on these issues, in addition to increased enforcement efforts by the NLRB.

Mr. Solomon and I will be sharing the dais at the NLRB Region 8 Labor Law conference. I’m kicking the conference off by moderating a panel on social media. Mr. Solomon is the lunch speaker. His topic is titled, The NLRB Today: Maintaining an Even Keel While the Storm Rages. I am very curious to hear how he describes today’s NLRB as an “even keel.” The SS NLRB leans a little too much to the port side for my (and most businesses’)taste.