If you’re not a class action lawyer (and if you are reading this blog we’ll assume that you aren’t!), you may not be aware of what arbitration is. And that’s unfortunate, because arbitration is a very bad thing for employees and consumers, and it restricts your access to the courts for just about any dispute that you might have.
Originally conceived of as a more convenient, less expensive and faster form of dispute resolution than going to court, arbitration gradually increased its reach into employer/employee interactions throughout the 2000’s, reaching its peak via a 2011 United States Supreme Court decision (AT&T v. Concepcion) that effectively said that a company could incorporate an “arbitration agreement” into small print/boilerplate language and then use it to prevent its employees/consumers from going to court against it. The Court also has concluded that parties cannot be required to engage in class action arbitration, and that a company can include a class action ban in its arbitration agreement, which precludes its employees/consumers from filing any kind of a class action. This means that what we call “low dollar claims,” like your dispute with your cellular provider about a useless tack on fee, or with your employer about missing rest breaks, cannot be pursued as a class or collective action. Because individual damages are small (for example, say your case alone is only worth $300) in these types of claims, and the costs to file a lawsuit/arbitration are relatively high, a class action ban means that there is no way to fight these things. No lawyer will take an individual case for $300 because it wouldn’t be good business to do so. This effectively gives companies open season to abuse consumers and employees via all sorts of fees and other abuses that will go unchallenged.
We’d have expected the conservative U.S. Supreme Court to continue to expand arbitration and pursue this unseemly trend, but – alas—we were delivered a small victory this month. On January 15, 2019, the U.S. Supreme Court held in New Prime, Inc. v. Olivera that the Federal Arbitration Act (the law that has been interpreted to allow for arbitration and class action prohibitions) does not apply to interstate transportation workers (in this case, drivers). What does this mean? Well, it means that if you carry goods across state lines (like a driver would), your employer’s boilerplate “arbitration agreement” with you is worthless. Regardless of what’s in the employee handbook or in a document you were made to sign, you get to pursue any employment claims that you have in court, and you can pursue a class action.
So, if you are an interstate transportation worker, rejoice. There’s justice in the world, after all. It’s our hope that the Supreme Court will follow up this encouraging case with others that limit the scope of forced arbitration. Stay tuned. And if you are a driver or work in some other capacity in interstate transportation (say, cruise ship workers), please reach out to us. You probably have employment claims that can now be pursued in a court of law, and we can help you do that without a fee (contingency fee/no win, no fee, only).