Written by Jill Collins
Yesterday, the Supreme Court denied a request to review the issue of whether the Fair Labor Standards Act grants employees a non-waivable right to bring a collective action and thus, renders arbitration agreements with collective action waivers unenforceable.
The Court denied a group of former auto repair employees’ petition for review of an Eleventh Circuit opinion that upheld a lower court ruling that an arbitration agreement with a collective action waiver was valid because the FLSA does not explicitly bar such agreements.
In the underlying decision, the Eleventh Circuit relied on the Supreme Court’s recent decision in American Express Co. v. Italian Colors, which upheld the validity of a similar agreement under the Age Discrimination in Employment Act. In their petition, the former employees argued the methods for achieving remedies under the ADEA is different from the FLSA because the ADEA provides for largely administrative remedies through the Equal Employment Opportunity Commission enforcement mechanisms, while the FLSA provides for immediate private lawsuits.
Unlike other federal anti-discrimination laws, though, the ADEA provides for collective action lawsuits under the same section and identical language as the FLSA. The Eleventh Circuit relied on interpretations of that collective action language from ADEA cases in its interpretation of the FLSA right to collective action and found that the Italian Colors decision signified that the high court would enforce arbitration agreements even where such agreements forced putative plaintiffs to relinquish their collective action rights.
The Supreme Court’s decision not to hear the case is a good indication that employers can still reasonably rely on the Italian Colors decision and include enforceable collective action waivers for any claims arising under the FLSA in their arbitration agreements.