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The JMK bLAWg

SCOTUS Grants Cert in Wisconsin Arbitration Clause Dispute

SCOTUS Grants Cert in Wisconsin Arbitration Clause Dispute

UPDATE to our July, 2016 blog post entitled Seventh Circuit Rules on Individual Arbitration Clauses in Employment Contracts:

On January 13, 2017 the United States Supreme Court granted certiorari to hear oral argument in Epic Systems Corp. v. Lewis. The case has been consolidated with two other claims related to the same legal issue. Software juggernaut Epic Systems, a Verona, Wisconsin-based corporation, caught the attention of many legal commentators when it circulated an email memorandum to its employees instituting a new policy of mandatory arbitration relative to all individual wage and hour disputes. The email further indicated that continued employment with Epic Systems constituted knowledge and consent to the new contractual terms.

A group of current and former employees prevailed over Epic Systems in the 7th Circuit Court of Appeals’ May, 2016 ruling. The three-judge panel upheld the decision of the U.S. District Court for the Western District of Wisconsin which held that the email arbitration notice was in direct violation of the National Labor Relations Act (NLRA). The NLRA provides employees with the right to self-organization, unionization, and collective bargaining. The Court ruled that by mandating individual rather than collective dispute resolution, Epic’s arbitration provision ran afoul of the Act.

In Epic’s Petition for Writ of Certiorari, the question presented to the Supreme Court for review is: “[w]hether an agreement that requires an employer and an employee to resolve employment-related disputes through individual arbitration, and waive class and collective proceedings, is enforceable under the Federal Arbitration Act, notwithstanding the provisions of the National Labor Relations Act.”

A definitive ruling on this issue by the high court may resolve decades of conflicting rulings by lower courts on this very topic.