Supreme Court to Hear Employment Class Action Waiver Dispute
As we have previously reported, there is a split in the federal appellate circuits on the validity of arbitration provisions with class action waivers in employment agreements. The Seventh and Ninth Circuit courts of appeals have ruled that arbitration agreements with class action waivers for employment matters can be violations of the National Labor Relations Act because they limit employees’ rights under the NLRA to engage in “concerted activities” in pursuit of their “mutual aid or protection”. Decisions from the courts of appeals on the Second, Fifth, and Eighth Circuits disagree.
On January 13, 2017, the United States Supreme Court agreed to hear the issue to decide what position is correct.
The case is scheduled to be heard in the spring with a decision expected by the early summer.
Supreme Court May Hear the Service Advisors Overtime Issue Again
Last year we reported on the Supreme Court decision in a case originating in California that service advisors do not fall under the salesmen, partsmen, and mechanics exception under the FLSA and are eligible for premium overtime. The Supreme Court did not rule substantively, but instead sent the case back to the Ninth Circuit Court of Appeals on the basis of a faulty Department of Labor regulation. The Supreme Court required the Ninth Circuit to consider the matter without reference to the Department of Labor regulation.
On January 9, 2017, the Ninth Circuit Court of Appeals again ruled that service advisors are eligible for premium overtime, this time based on an analysis of the underlying statute.
This sets up another potential trip to the Supreme Court for this case. The Ninth Circuit decision is contrary to the decisions in the Fourth and Fifth Circuits, numerous district court decisions, and a decision by the Supreme Court of Montana.
For now, unless you are in one of the states covered by the Ninth Circuit Court of Appeals, there is no reason for change in your treatment of service advisors’ pay. The Supreme Court eventually may weigh in on this. There are other changes that are possible such as a regulatory change by the Department of Labor under a Trump appointee, or even a congressional change to the Fair Labor Standards Act to clarify that the salesmen, mechanics, and partsmen exception covers service advisors.