February 12, 2016.
from the United States District Court for the Western
District of Wisconsin. No. 15-cv-82-bbc -- Barbara B. Crabb,
Jacob Lewis, Plaintiff - Appellee: Daniel A. Rottier,
Attorney, Jason J. Knutson, Attorney, Breanne L. Snapp,
Attorney, Habush, Habush & Rottier, Madison, WI; Caitlin M.
Madden, Attorney, William E. Parsons, Attorney, Katelynn M.
Williams, Attorney, David C. Zoeller, Attorney, Hawks
Quindel, S.C., Madison, WI.
Epic Systems Corporation, Defendant - Appellant: Noah A.
Finkel, Attorney, Andrew L. Scroggins, Attorney, Seyfarth
Shaw LLP, Chicago, IL.
Labor Law Scholars, Amicus Curiae: Barry M. Bennett,
Attorney, Dowd, Bloch, Bennett, Cervone, Auerbach & Yokich,
National Labor Relations Board, Amicus Curiae: Joel A.
Heller, Attorney, National Labor Relations Board, Washington,
DC; Jeffrey William Burritt, Attorney, National Labor
Relations Board, Contempt Litigation & Compliance Branch,
WOOD, Chief Judge, ROVNER, Circuit Judge, and BLAKEY,
Systems, a health care software company, required certain
groups of employees to agree to bring any wage-and-hour
claims against the company only through individual
arbitration. The agreement did not permit collective
arbitration or collective action in any other forum. We
conclude that this agreement violates the National Labor
Relations Act (NLRA), 29 U.S.C. § § 151, et
seq., and is also unenforceable under the Federal
Arbitration Act (FAA), 9 U.S.C. § § 1, et
seq. We therefore affirm the district court's denial
of Epic's motion to compel arbitration.
April 2, 2014, Epic Systems sent an email to some of its
employees. The email contained an arbitration agreement
mandating that wage-and-hour claims could be brought only
through individual arbitration and that the employees waived
" the right to participate in or receive money or any
other relief from any class, collective, or representative
proceeding." The agreement included a clause stating
that if the " Waiver of Class and Collective
Claims" was unenforceable, " any claim brought on a
class, collective, or representative action basis must be
filed in a court of competent jurisdiction." It also
said that employees were " deemed to have accepted this
Agreement" if they " continue[d] to work at
Epic." Epic gave employees no option to decline if they
wanted to keep their jobs. The email requested that
recipients review the agreement and acknowledge their
agreement by clicking two buttons. The following day, Jacob
Lewis, then a " technical writer" at Epic, followed
those instructions for registering his agreement.
however, Lewis had a dispute with Epic, and he did not
proceed under the arbitration clause. Instead, he sued Epic
in federal court, contending that it had violated the Fair
Labor Standards Act (FLSA), 29 U.S.C. § § 201,
et seq. and Wisconsin law by misclassifying him and
his fellow technical writers and thereby unlawfully depriving
them of overtime pay. Epic moved to dismiss Lewis's claim
and compel individual arbitration. Lewis responded that the
arbitration clause violated the NLRA because it interfered
with employees' right to engage in concerted activities
for mutual aid and protection and was therefore
unenforceable. The district court agreed and denied
Epic's motion. Epic appeals, arguing that the district
court erred in declining to enforce the agreement under the
FAA. We review de novo a district court's
decision to deny a motion to compel arbitration. Gore v.
Alltel Commc'ns, LLC, 666 F.3d 1027, 1033 (7th Cir.
7 of the NLRA provides that " [e]mployees shall have the
right to self-organization, to form, join, or assist labor
organizations, to bargain collectively through
representatives of their own choosing, and to engage in other
concerted activities for the purpose of collective bargaining
or other mutual aid or protection." 29 U.S.C. §
157. Section 8 enforces Section 7 unconditionally by deeming
that it " shall be an unfair labor practice for an
employer ... to interfere with, restrain, or coerce employees
in the exercise of the rights guaranteed in [Section
7]." Id. § 158(a)(1). The National Labor
Relations Board is " empowered ... to prevent any person
from engaging in any unfair labor practice ... affecting
commerce." Id. § 160(a).
Contracts " stipulat[ing] ... the renunciation by the
employees of rights guaranteed by the [NLRA]" are
unlawful and may be declared to be unenforceable by the
Board. Nat'l Licorice Co. v. NLRB, 309 U.S. 350,
365, 60 S.Ct. 569, 84 L.Ed. 799 (1940) (" [I]t will not
be open to any tribunal to compel the employer to perform the
acts, which, even though he has bound himself by contract to
do them, would violate the Board's order or be
inconsistent with any part of it[.]" ); J.I. Case
Co. v. NLRB, 321 U.S. 332, 337, 64 S.Ct. 576, 88 L.Ed.
762 (1944) (" Wherever private contracts conflict with
[the Board's] functions, they obviously must yield or the
[NLRA] would be reduced to a futility." ). In accordance
with this longstanding doctrine, the Board has, " from
its earliest days," held that " employer-imposed,
individual agreements that purport to restrict Section 7
rights" are unenforceable. D. R. Horton, Inc.,
357 N.L.R.B. No. 184 at *5, 357 N.L.R.B. 2277 at 2280 (2012)
(collecting cases as early as 1939), enf'd in part
and granted in part, D.R. Horton, Inc. v. NLRB,
737 F.3d 344 (5th Cir. 2013). It has done so with "
uniform judicial approval." Id. (citing as
examples NLRB v. Vincennes Steel Corp., 117 F.2d
169, 172 (7th Cir. 1941), NLRB v. Jahn & Ollier Engraving
Co., 123 F.2d 589, 593 (7th Cir. 1941), and NLRB v.
Adel Clay Products Co., 134 F.2d 342 (8th Cir. 1943)).
7's " other concerted activities" have long
been held to include " resort to administrative and
judicial forums." Eastex, Inc. v. NLRB, 437
U.S. 556, 566, 98 S.Ct. 2505, 57 L.Ed.2d 428 (1978)
(collecting cases). Similarly, both courts and the Board have
held that filing a collective or class action suit
constitutes " concerted activit[y]" under Section
7. See Brady v. Nat'l Football League, 644 F.3d
661, 673 (8th Cir. 2011) (" [A] lawsuit filed in good
faith by a group of employees to achieve more favorable terms
or conditions of employment is 'concerted
activity' under § 7 of the National Labor Relations
Act." ); Altex Ready Mixed Concrete Corp. v.
NLRB, 542 F.2d 295, 297 (5th Cir. 1976) (same);
Leviton Mfg. Co. v. NLRB, 486 F.2d 686, 689 (1st
Cir. 1973) (same); Mohave Elec. Co-op., Inc. v.
NLRB, 206 F.3d 1183, 1189, 340 U.S.App.D.C. 391 (D.C.
Cir. 2000) (single employee's filing of a judicial
petition constituted " concerted action" under NLRA
where " supported by fellow employees" ); D. R.
Horton, 357 N.L.R.B. No. 184, at *2 n.4, 357 N.L.R.B.
2277, at 2278 (collecting cases). This precedent is in line
with the Supreme Court's rule recognizing that even when
an employee acts alone, she ...