A Substantive Right to Class Proceedings: The False Conflict between the FAA and NLRA

Abstract

In recent decades, the U.S. Supreme Court’s Federal Arbitration Act jurisprudence has greatly expanded the scope of enforceable arbitration agreements. In AT&T Mobility LLC v. Concepcion, decided in 2011, the Court held that a class arbitration waiver in a consumer contract was enforceable, despite state law to the contrary. In January 2012, the National Labor Relations Board ruled that, despite the Court’s holding in Concepcion, class waivers in employment arbitration agreements are unenforceable due to employees’ right under the National Labor Relations Act to engage in concerted activity. However, nearly all federal and state courts that have subsequently considered this question have declined to follow the NLRB and have enforced similar class waivers.

This Note argues that the NLRB was correct in declaring unenforceable class waivers in employment arbitration agreements. It concludes that because employees’ right to invoke class proceedings under the NLRA is a substantive rather than procedural right, the unwaivability of this right creates no conflict with the FAA, even under the Supreme Court’s broad interpretation of the statute.

Keywords: class action, class waiver, concepcion, d.r. horton, arbitration, arbitration agreement, class arbitration, employment, nlrb, nlra, substantive right, section 7, at&t mobility, horton