On Monday the United States Supreme Court ruled in an arbitration case seen as a victory for large employers and a major blow to union organizers. Justice Neil Gorsuch wrote the opinion for the 5-4 majority including Roberts, Kennedy, Thomas, and Alito while Justice Ginsburg wrote for the left bloc of herself, Breyer, Sotomayor, and Kagan in Epic Systems v. Lewis. This holding scuttled the hopes of labor lawyers and union organizers who tried to see most compulsory arbitration provisions held void. The Court decided that these mandatory arbitration agreements are not overruled by the National Labor Relations Act (NLRA).
This ruling showcased the deep ideological divide of the Supreme Court, as Justice Gorsuch addressed the dissent directly in his opinion, including a near item by item refutation of Ginsburg’s arguments. Justice Ginsburg took the uncommon step of reading portions of her dissent aloud from the bench when the ruling was announced.
A worker can’t start or join a class-action lawsuit against their employer if they previously agreed not to. That’s the sum of the ruling here. In an attempt to create a new right out of an old law, the movers behind this suit argued that the NLRA of 1935 made a clause of the Federal Arbitration Act (FAA) of 1925 null and void. They argued that the NLRA’s guarantee of a right to work together for “mutual aid and protection” displaced or superseded the FAA provisions guaranteeing that arbitration agreements would be honored.
Justice Neil Gorsuch
If these laws were passed in the 1920’s and 30’s, why are we just getting around to figuring out what they mean now? Justice Gorsuch noted that the law seemed well settled, up to and including 2010 when the top lawyer for the National Labor Relations Board, in charge of implementing the NLRA, did not dispute that the NLRA and the FAA worked together. Gorsuch explains:
But recently things have shifted. In 2012, the Board— for the first time in the 77 years since the NLRA’s adoption—asserted that the NLRA effectively nullifies the Arbitration Act in cases like ours. Initially, this agency decision received a cool reception in court. In the last two years, though, some circuits have either agreed with the Board’s conclusion or thought themselves obliged to defer to it… More recently still, the disagreement has grown as the Executive has disavowed the Board’s (most recent) position, and the Solicitor General and the Board have offered us battling briefs about the law’s meaning. We granted certiorari to clear the confusion.
The decision was a victory for all those who argue that newly discovered rights should be treated with skepticism and that the Congress, and not the courts, is the place for the hash of legislation to be formed.
