The Summer of 2018 was bad for workers at the Supreme Court. First, in Epic Systems v. Lewis, the Court held that employers can use arbitration agreements to block their employees from participating in class action lawsuits. Second, in Janus v. AFSCME, the Court held that public sector employees cannot be required to pay their fair share of the cost of negotiating and administering the collective bargaining agreement. Each decision is discussed below.
The first decision of this terrible pair is Epic Systems v. Lewis. The case concerned whether employers can require employees to sign arbitration agreements prohibiting them from joining together in class action lawsuits. The National Labor Relations Act gives employees the right to engage in “concerted activities” in furtherance of “mutual aid and protection.” The employers in Epic Systems argued that employees’ rights to engage in concerted activity under the NLRA should give way to the Federal Arbitration Act. In a 5-4 decision authored by Justice Gorsuch, the Court sided with the employers, holding that arbitration agreements “must be enforced as written.”
Epic Systems has important ramifications. Employees are often unable to enforce their rights in the workplace if they must do it alone. Perhaps the potential damages are too small for an attorney to take an individual case, they do not want to draw attention to themselves, they fear retaliation. But there is strength in numbers, and these concerns are not so weighty when employees can stand together in a class action lawsuit. Epic Systems permits employers to strip employees of this important tool by forcing them to sign arbitration agreements prohibiting them from engaging in class action lawsuits.
The Summer’s blockbuster decision was Janus v. AFSCME, where the conservative justices’ fascination with overruling the Court’s 1977 decision in Abood v. Detroit Board of Education finally paid off. The Abood Court unanimously held that public sector employees may be required to pay an “agency fee” to “finance expenditures by the Union for the purposes of collective bargaining, contract administration, and grievance adjustment.” It is important to note that employees already could not be compelled to pay for a union’s political activities, nor can they be compelled to be a member of the union.
Abood had been the law of the land for four decades. But with the Court now home to five conservative justices, anti-union special interest groups were able to succeed on the far-fetched claim that agency fees somehow violate the First Amendment. Janus opens the flood gates for free-riders in public sector unions.
These decisions make it harder for employees to band together. Under the current Supreme Court, we can expect to see more challenges to employee rights in both union and non-union workplaces.