U.S. Supreme Court.

 

The more than 150 cases pending at the National Labor Relations Board and federal appeals courts reveal just how far a U.S. Supreme Court case could reach after the justices this term decide whether employment contracts can ban class actions.

The Supreme Court heard arguments in October in a trio of cases that confront the lawfulness of class action waivers. The action in the high court put hundreds of cases on hold at the labor board and in federal appeals courts, including employee actions against major financial institutions, health care and tech giants, and household-name retailers.

Companies and advocates are watching the case closely, particularly given the new significance amid the #MeToo movement, where women are coming together to speak out against sexual harassment in the workplace. More than half of private-sector employers have mandatory arbitration procedures, and 30 percent of these include class action waivers, the Economic Policy Institute reported in a study last year.

A recent memorandum from the NLRB general counsel's office identified 152 cases awaiting the Supreme Court decision. Of those, 52 are on hold in appeals courts around the country. The full list is below:

Agreements that force employees to use arbitration for work-related disputes interfere with employees' rights to engage in concerted activities under the National Labor Relations Act, the board determined in a case that's at the Supreme Court now. The board said that when such an agreement violates the act, the Federal Arbitration Act does not require its enforcement.

Big-name companies with employment contract cases pending in federal appeals courts include AT&T, American Express, Dominos Pizza, Hobby Lobby and CVS Pharmacy. JPMorgan Chase and Uber Technologies have pending cases at the NLRB. In certain instances, these cases have been on hold for years.

➤➤  The case against CVS RX Services Inc. and CVS Pharmacy Inc. filed by former pharmacist Kenneth Sternfeld surrounded a medical leave issue. The NLRB ruled in favor of the employee, with a dissent from former Republican-appointed member Philip Miscimarra, who has since rejoined Morgan, Lewis & Bockius.

The board's ruling concluded that CVS violated employees' rights “by implementing and maintaining an arbitration program that requires employees, as a condition of employment, to waive their rights to pursue class or collective actions involving employment-related claims in all forums, whether arbitral or judicial, unless employees individually opt out of the waiver.”

The CVS case is on hold on appeal in the U.S. Court of Appeals for the Fifth Circuit.

➤➤  Several other cases center around wage-and-hour disputes, including a pending case against Bloomingdales Inc., which is on hold in the U.S. Court of Appeals for the Ninth Circuit.

A former employee filed the class action over unpaid overtime pay. A decision in favor of the employer came down in 2014, around the same time as a similar case against Nordstrom. Settlements of wage-and-hour cases have ballooned in recent years, according to a report from Seyfarth Shaw.

➤➤  There are also at least a handful of cases that did not originate at the board. One is Bekele v. Lyft, which started in Boston federal court and now is on hold in the First Circuit. In this case, drivers from the California-based ride-hailing company seek class action status in a dispute over whether they should be considered employees, rather than independent contractors. A mountain of similar cases have been filed in recent years and is a central issue in the debate over workers rights in the rising gig economy.

No matter how the Supreme Court comes down on class action waivers, there will be a close eye on these issues when they are heard by the NLRB.

There's an open question at the board over whether Trump-appointed member William Emanuel will be allowed to participate in hearing employment-contract cases tethered to the board's ruling in the D.R. Horton case, one of the cases before the Supreme Court now. Emanuel represented clients as a shareholder at his former firm, Littler Mendelson, associated with D.R. Horton.

“The principle is well established: if a public official is recused from participating in Case X, that official must also be recused from every case that may have a controlling effect on Case X, even if those cases are separate,” Outten & Golden said in a filing at the NLRB urging Emanuel to sit on the sidelines.

The motion predated the accusations against Emanuel that followed his vote to upend a controversial Obama-era rule that put companies on the hook for their franchisees and independent contractors. An internal report found that because Littler represented a party in the case on appeal, Emanuel should have recused.

 

Read more:

Inside a Morgan Lewis Partner's New Conflicts Disclosures for NLRB Post

Read the NLRB Memo Defending Google's Firing of James Damore

Trump's Latest NLRB Pick Vows Not to 'Repeat' Conflict Dogging Another Member

John Ring of Morgan Lewis, Trump Pick for NLRB, Discloses $2.7M Partner Share