Time To Rethink Mandatory Arbitration Agreements? U.S. Supreme Court Rules Class Action Waivers Are

The U.S. Supreme Court has delivered a major victory for employers across America – ruling that mandatory arbitration agreements that contain a provision prohibiting any form of class or collective litigation are lawful.The issue was ripe for consideration at the Supreme Court because there was a split among the Circuit Courts of Appeal as to whether such provisions were enforceable.Thus, employers in some states could have the class action waiver, while employers in other states could not.

The decision comes as a result of three consolidated cases (Epic Systems Corp. v. Lewis, NLRB v. Murphy Oil USA Inc. and Ernst & Young LLP v. Morris), each of which involved employees who had signed mandatory arbitration agreements as a condition of their employment. Under those agreements, the employees waived their right to file or join a class-action suit against their employers.

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