So Long, Class Action Waivers

Attention employers: have you reviewed your employment contracts lately? They may include a provision that violates federal labor law. Last week, the National Labor Relations Board instructed the restaurant chain Waffle House Inc. to remove class action waivers from its employee agreements.

Beginning in 2013, Waffle House required its employees to sign arbitration agreements with class action waivers as a condition of employment. The National Labor Relationship Board has now decided that Waffle House has engaged in unfair labor practices by restricting class action claims, and it has instructed Waffle House to not only remove the provision, but also to notify all employees of this change. While employers are still able to require employees to agree to arbitrating any claims that arise (versus filing a civil lawsuit), the controversial portion of the agreement requires an employee to waive his or her right to bring a class action claim.

If you have employees sign an arbitration agreement, class action waiver, or both, it is time to have them reviewed for compliance.

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