SCOTUS Case: Do Workers Have a Right to Class-Action Lawsuits?

By: Eric Tegethoff, Public News Service – WA

SEATTLE – Workers in Washington state and across the country watched the U.S. Supreme Court closely Monday as justices heard oral arguments in a case to determine whether employers can ban class-action lawsuits.

The case, Epic Systems Corporation versus Lewis, involves arbitration agreements often found in the fine print of employee contracts. About one-quarter of private-sector employees, or nearly 25 million Americans, have signed agreements that waive their right to sue employers collectively, according to the Economic Policy Institute.

Elizabeth Hanley, an employment law attorney for Reed, Longyear, Malnati and Ahrens law firm, says class actions are important in cases of wage theft.

“There’s often very small amounts of money affecting many, many employees, and it can be cost-prohibitive for them to litigate them individually,” she explains.

Epic Systems and other companies argue that employers need to know if class-action waivers in their workers’ contracts apply. If they don’t, the companies say, that will change the employer-employee relationship. A decision on this case is expected at the end of the court’s session in June.

During arguments, Justice Stephen Breyer said a ruling in favor of employers would rip out “the entire heart of the New Deal” and change our understanding of labor relations dating back to the Great Depression. Hanley says class actions have been important tools for workers in labor disputes.

“I don’t think, without the weight of class actions, that you will be likely to see the enforcement of wage and hour laws or employers incentivized to change any unlawful practices,” she warns.

The Epic Systems case, along with the two others to join it, deal with the conflict between two federal laws. The Federal Arbitration Act of 1925 favors arbitration. But the National Labor Relations Act of 1935 encourages workers to sue collectively in labor disputes.