Authored by Rob Whitman
Two courts on opposite sides of the country have upheld class action waivers in arbitration agreements in wage-hour suits, following the Supreme Court’s holding in AT&T Mobility v. Concepcion and rejecting the reasoning of the NLRB in D.R. Horton.
In San Diego, Judge Michael Anello held in Coleman v. Jenny Craig, Inc. that an arbitration agreement was enforceable under California law despite the inclusion of a class-action waiver that required arbitration “on an individual basis” and barred employees “from participating in a class action (existing or future) that was brought by any other party.” The court specifically rejected challenges that this waiver rendered the agreement unconscionable, following several recent cases upholding similar waivers in light of Concepcion.
In Tampa, Judge Richard Lazzara reached a similar result in De Oliveira v. Citigroup North America, Inc., a case challenging the exempt status of Financial Analysts. Following 11th Circuit precedent – one pre-Concepcion case upholding a collective action waiver in an FLSA lawsuit, and a post-Concepcion case enforcing a waiver in a consumer agreement – the court held that the plaintiffs were required to arbitrate their claims even though they must do so individually rather than collectively. Judge Lazzara explicitly refused to follow either D.R. Horton or Raniere v. Citigroup, Inc., in which a District Court in New York invalidated the company’s waiver on grounds that the FLSA’s collective action provision is unwaivable.
Perhaps it was the sunny climates that helped these courts see the light. Taken together, these two brief decisions are additional support for employers looking to enforce class action waivers in the face of aggressive resistance by the plaintiffs’ bar and the NLRB.