NLRB Strikes Down Class Action Arbitration Waiver

In a decision issued January 3, and released on Friday, January 6, the National Labor Relations Board (NLRB) held that a mandatory arbitration agreement which required all employment-related disputes to be submitted to arbitration, but also prohibited the arbitrator from considering class or collective action claims, violated the National Labor Relations Act (NLRA). D.R. Horton, Inc., Case 12-CA-25764 (January 3, 2012). A copy of the decision can be found here. The case arose out of a claim by a former "superintendent" for the employer alleging that he had been misclassified as a salaried exempt employee. The former employee sought to initiate an arbitration proceeding on behalf of himself and a nationwide class of similarly situated superintendents to pursue claims for unpaid overtime under the Fair Labor Standards Act. The employer refused, relying on the arbitration agreement's prohibition against arbitration of collective claims. The NLRB, in an opinion by