In January we blogged about the NLRB’s decision in D.R. Horton, Inc., which said that requiring employees, as a condition of employment, to sign an arbitration agreement barring collective or class actions for employment-related claims violated the law (see NLRB Says Not To Requiring Employees To Sign Arbitration Agreements Prohibiting Group of Class Action). A federal district court in Tampa recently declined to follow the NLRB’s D.R. Horton decision and compelled arbitration of a Fair Labor Standards Act collective action.
In Oliveira v. Citigroup North America, Inc., the plaintiff and five opt in plaintiffs sued Citigroup under the Fair Labor Standards Act (FLSA) for the alleged failure to pay overtime. All of the plaintiffs had signed acknowledgements of employee handbooks containing mandatory arbitration clauses. The arbitration clauses in the handbooks required arbitration and said that arbitration was the exclusive forum for resolution of all disputes arising out of or in any way related to the employment. The clause also said that claims had to be brought on an individualized basis and that employees could not participate as a class or collective action representative or as a member of any class, collective, or representative action. Relying on these clauses, Citigroup filed a motion with the court to compel individual arbitration of each of the plaintiffs’ claims. The district court in Tampa had to decide whether a collective action waiver in an arbitration agreement is enforceable. Applying law from the Eleventh Circuit Court of Appeals, which is binding on federal courts in Florida, the district court found that the arbitration agreements were enforceable and waived the plaintiffs’ right to pursue collective claims under the FLSA. The district court in Tampa declined to follow the NLRB’s decision in D.R. Horton, saying that it was bound to follow the Eleventh Circuit case law that enforced a collective action waiver to compel arbitration of an individual’s FLSA overtime claim.
Other courts in Florida are not required to follow the Tampa court’s decision in Oliveira. Nevertheless, the decision lends further strength to the enforceability of arbitration clauses, including those that waive an employee’s right to bring or participate in a collective or class action against their employee.