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MAY 21, 2018, 11:01 AM
The Supreme Court held on Monday that employers can force their employees to sign away many of their rights to sue their employers. As a practical matter, Monday’s decision in Epic Systems v. Lewis will enable employers to engage in small-scale wage theft with impunity, so long as they spread the impact of this theft among many employees.
Neil Gorsuch, who occupies the seat that Senate Republicans held open for a year until Donald Trump could fill it, wrote the Court’s 5-4 decision. The Court split along party lines.
Epic Systems involves three consolidated cases, each involving employment contracts cutting off employees’ rights to sue their employer in a court of law. In at least one of these cases, the employees were required to sign away these rights as a condition of starting their job. In another, existing workers were told to sign away their rights if they wanted to keep working.
Each contract contained two provisions, a “forced arbitration” provision, which requires legal disputes between the employer and the employee to be resolved by a private arbitrator and not by a real court; and a provision prohibiting employees from bringing class actions against the employer.
Writing with his trademarked smugness, Gorsuch presents Epic Systems as a simple application of a legal text. “The parties before us contracted for arbitration,” he writes. “They proceeded to specify the rules that would govern their arbitrations, indicating their intention to use individualized rather than class or collective action procedures. And this much the Arbitration Act seems to protect pretty absolutely.”
It’s the sort of statement someone might write if they’d never read the Federal Arbitration Act — the law at the heart of this case — and had only read the Supreme Court’s decisions expanding that act’s scope.
Broadly speaking, the Federal Arbitration Act requires courts to honor arbitration agreements, and to ignore legal doctrines that disfavor arbitration as a method of resolving disputes. Yet the Act also exempts “workers engaged in foreign or interstate commerce.”
Nevertheless, in a 5-4 decision in Circuit City v. Adams, the Supreme Court held that the Act applies to most workers engaged in foreign or interstate commerce. If Gorsuch were concerned with the text of the Arbitration Act, he might have called for additional briefing on whether Circuit City should be overruled. Instead, he compounded the Court’s error in Circuit City — all while insisting that an anti-worker outcome is required by the law’s text.