SCOTUS to Tackle Interaction of FAA, NLRA on Arbitration Agreement Issue
In their Arbitration column, Samuel Estreicher and Holly H. Weiss discuss cases recently argued before the U.S. Supreme Court that, at their core, concern how two federal statutes—the FAA and the NLRA—interact and raise the basic question of whether the NLRB has authority to regulate arbitration agreements in the nonunion sector.
October 19, 2017 at 02:00 PM
6 minute read
These cases deal with employees who were required to sign arbitration agreements as a condition of their employment promising to resolve disputes with their employers through arbitration and waiving their rights to bring class or collective arbitrations. At their core, these cases concern how two federal statutes—the Federal Arbitration Act (FAA) and the National Labor Relations Act (NLRA)—interact. They also raise the basic question whether the National Labor Relations Board (NLRB), the agency responsible for enforcing the NLRA, has authority to regulate arbitration agreements in the nonunion sector.
The FAA provides that an agreement to settle a controversy by arbitration “shall be valid, irrevocable, and enforceable, save upon such grounds as exist at law or in equity for the revocation of any contract.” 9 U.S.C. §2. Section 7 of the NLRA provides employees with the right “to engage in other concerted activities for the purpose of collective bargaining or other mutual aid or protection.” 29 U.S.C. §157. The employers argue that “the FAA will only yield in the face of a contrary congressional command,” and in the cases at bar, no such contrary congressional command exists. See CompuCredit v. Greenwood, 132 S. Ct. 665 (2012). The NLRB and the employees argue that §7 of the NLRA is such a contrary congressional command. 29 U.S.C. §157.
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