The NLRB has held that “an employer violates Section 8(a)(1) of the National Labor Relations Act when it requires employees covered by the Act, as a condition of their employment, to sign an agreement that precludes them from filing joint, class, or collective claims addressing their wages, hours or other working conditions against the employer in any forum, arbitral or judicial.”  D. R. Horton, Inc. and Michael Cuda. Case 12–CA–25764 (01/03/2012).  This ruling will apply to any private employer over which the Board has jurisdiction regardless of whether it is unionized.  Thus, according to the NLRB, an arbitration agreement which prohibits an employee from pursuing a class or collective claim is illegal.

This poses tough questions for employment arbitrators.  If an arbitrator is faced with an arbitration agreement between an employer and an employee that prohibits class or collective actions, what is his or her obligation if the employer insists on enforcing the contractual restriction? Unless an employee or a union files a ULP charge and the NLRB obtains a Section 10(j) injunction against the employer, does the arbitrator pay any attention to the NLRB position on this issue? What is the impact of AT&T Mobility, reflecting the Supreme Court's skepticism of arbitrators' ability to properly conduct class actions? What will AAA and JAMS do, if anything? Interesting times ahead in employment arbitration cases.