The United States Court of Appeals for the Seventh Circuit in Chicago handed down a surprising verdict recently when it ruled that the Epic Systems Corporation headquartered in Wisconsin was in violation of the 1935 National Labor Relations Act (NLRA) that protects the rights of employees to unionize or bring collective action against their employer. According to the Court’s decision, Epic Systems violated the NLRA by requiring employees to sign an arbitration clause that mandated they rely solely on arbitration to settle wage and hour disputes.
Epic Systems is a medical software company that sent out an email in 2014 that required employees to agree to internal mediation for all wage and hour disputes, ultimately denying them their right to bring collective action against the company. Epic Systems stated in the agreement that the employee’s decision to acknowledge receipt of the email and continue employment with the company indicated that they agreed to the arbitration agreement. When an employee of the company later filed a suit in federal court against Epic Systems for denied overtime wages, the company referred to a previous U.S. Supreme Court decision that allowed a group of credit card companies the right to use arbitration as a means to resolve internal conflict.
In 2013, the United States Court of Appeals in Louisiana upheld a 2011 Supreme Court decision that ruled the Federal Arbitration Act of 1925 gave employers the right to use arbitration to settle claims against the employer. The recent verdict handed down by the Chicago Court of Appeals is in direct opposition to this decision, clearly stating that the National Labor Relations Act of 1935 overrules the 1925 Federal Arbitration Act. This dispute could mean the U.S. Supreme Court will have to revisit the issue if Epic Systems decides to appeal the Chicago Court of Appeals decision.
As more and more employers include arbitration agreements in their employment contracts, many have argued that the practice has the potential to conceal unfair labor practices. In a survey conducted by The New York Times, many employees reported that they “give up” on bringing disputes to their employers when they are prohibited from doing so collectively. Without the power of numbers and the evidence that they bring to support claims, many believe they do not stand a chance of a fair resolution.
Epic Systems Corporation has 90 days to appeal the Chicago decision. As of yet, the company has not indicated that they will pursue bringing the issue to the United States Supreme Court.
Philadelphia Employment Lawyers at Sidkoff, Pincus & Green P.C. Use Experience and Knowledge for Successful Litigation
Philadelphia employment lawyers at Sidkoff, Pincus & Green P.C. have been serving clients throughout Pennsylvania for over 50 years. Our team of dedicated has a long history of successful outcomes in a vast array of varied employment law cases.
Call us today at 215-574-0600, or contact us online to see how we can help you with your employment legal issues. Our offices are conveniently located in Center City Philadelphia, allowing us to serve clients throughout Southeastern Pennsylvania and New Jersey.