Supreme Court Decision Delivers Blow To Workers' Rights


People wait in line to enter the U.S. Supreme Court last month. The court sided with businesses on not allowing class-action lawsuits for federal labor violations.

Mark Wilson/Getty Images

Updated at 7:08 p.m. ET

In a case involving the rights of tens of millions of private sector employees, the U.S. Supreme Court, by a 5-4 vote, delivered a major blow to workers, ruling for the first time that workers may not band together to challenge violations of federal labor laws.

Writing for the majority, Justice Neil Gorsuch said that the 1925 Federal Arbitration Act trumps the National Labor Relations Act and that employees who sign employment agreements to arbitrate claims must do so on an individual basis — and may not band together to enforce claims of wage and hour violations.

"The policy may be debatable but the law is clear: Congress has instructed that arbitration agreements like those before us must be enforced as written," Gorsuch writes. "While Congress is of course always free to amend this judgment, we see nothing suggesting it did so in the NLRA — much less that it manifested a clear intention to displace the Arbitration Act. Because we can easily read Congress's statutes to work in harmony, that is where our duty lies."

Ginsburg dissents

Justice Ruth Bader Ginsburg, writing for the four dissenters, called the majority opinion "egregiously wrong." She said the 1925 arbitration law came well before federal labor laws and should not cover these "arm-twisted," "take-it-or-leave it" provisions that employers are now insisting on.

She noted that workers' claims are usually small, and many workers fear retaliation. For these reasons, she said, relatively few workers avail themselves of the arbitration option. On the other hand, these problems are largely by a class-action suit brought in court on behalf of many employees.

The inevitable result of Monday's decision, she warned, will be huge underenforcement of federal and state laws designed to advance the well-being of vulnerable workers. It is up to Congress, she added, to correct the court's action.

In his oral announcement, Gorsuch took the unusual step of elaborately rebutting Ginsburg's dissent, which is five pages longer than the majority's opinion.

A green light for employers

The ruling came in three cases — potentially involving tens of thousands of nonunion employees — brought against Ernst & Young LLP, Epic Systems Corp. and Murphy Oil USA Inc.

Each required its individual employees, as a condition of employment, to waive their rights to join a class-action suit. In all three cases, employees tried to sue together, maintaining that the amounts they could obtain in individual arbitration were dwarfed by the legal fees they would have to pay. Ginsburg's dissent noted that a typical Ernst & Young employee would likely have to spend $200,000 to recover only about $1,900 in overtime pay.

The employees contended that their right to collective action is guaranteed by the National Labor Relations Act. The employers countered that they are entitled to ban collective legal action under the Federal Arbitration Act, which was enacted in 1925 to reverse the judicial hostility to arbitration at the time.

Employment lawyers were elated. Ron Chapman, who represents management in labor-management disputes, said he expects small and large businesses alike to immediately move to impose these binding arbitration contracts to eliminate the fear of costly class-action verdicts from juries. "It gives employers the green light to eliminate their single largest employment law risk with the stroke of a pen," he said.

Implications for #MeToo

Labor law experts said Monday's decision very likely will present increasing problems for the #MeToo movement, and for other civil rights class actions claiming discrimination based on race, gender and religion. There is no transparency in most binding arbitration agreements, and they often include nondisclosure provisions. What's more, class actions deal with the expense and fear of retaliation problems of solo claims. As Ginsburg put it, "there's safety in numbers."

Yale Law professor Judith Resnik observed that the decision applies to all manner of class actions. "What this says is that when you buy something, use something, or work for someone, that entity can require you to waive your right to use public courts," she noted.

Cornell University labor law professor Angela Cornell expects the number of these litigation waivers to skyrocket now. "What we see is the privatization of our justice system," she said.

A study by the left-leaning Economic Policy Institute shows that 56 percent of nonunion private sector employees are currently subject to mandatory individual arbitration procedures under the 1925 Federal Arbitration Act, which allows employers to bar collective legal actions by employees.

The court's decision means that tens of millions of private nonunion employees will be barred from suing collectively over the terms of their employment.

Correction May 22, 2018

A previous version of this story misspelled Yale Law professor Judith Resnik's name.

We the People of the United States, in Order to form a more perfect Union, establish Justice, insure domestic Tranquility, provide for the common defense, promote the general welfare, and secure the Blessings of liberty to ourselves and our Posterity, do ordain and establish this Constitution for the United States of America.

Article. I.

Section. 1.  All legislative Powers herein granted shall be vested in a congress of the United States, which shall consist of a Senate and House of Representatives.

Article. III.

Section. 1. The judicial Power of the United States, shall be vested in one Supreme Court, and in such inferior courts as the Congress may from time to time ordain and establish.  The Judges, both of the supreme and inferior Courts, shall hold their Offices during good Behavior, and shall, at stated Times, receive for their Services, a compensation, which shall not be diminished during their continuance in Office.

Section. 2. The judicial Power shall extend to all Cases, in Law and Equity, arising under this Constitution, the Laws of the United States....


When in the Course of human Events, it becomes necessary for one people to dissolve the Political Bands which have connected them with another, and to assume among the Powers of the Earth, the separate and equal Station to which the Laws of Nature and of Nature's God entitle them, a decent Respect to the Opinions of Mankind requires that they should declare the causes which impel them to the Separation.

We hold these Truths to be self-evident, that all Men are created equal, that they are endowed by their Creator with certain unalienable rights, that among these are Life, Liberty, and the pursuit of Happiness--That to secure these right, governments are instituted among Men, deriving their just Powers from the consent of the governed, that whenever any Form of government becomes destructive of these Ends, it is the Right of the People to alter or to abolish it, and to institute new Government, laying its foundation on such Principles, and organizing its Powers in such form, as to them shall seem most likely to affect their Safety and Happiness....


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Comment by mary gravitt on May 22, 2018 at 11:07am

It's an old Fascist trick to make you see evil in other governments when your government is screwing you over.  The Working class has just lost all right to its labor to the bosses while it tricks US into watching Iran and the Venezuela election.  The US hegemon goes around the world oppressing it friends and foes by making them think that democracy is not a cloaking device for neocolonialism.  We are now bracing for the permanent war that was promised in Orwell's 1984.

Comment by koshersalaami on May 23, 2018 at 4:13am

Oddly, the phenomenon you’re describing in your comment is exactly what Arab governments did for years vis-a-vis Israel: point out evil in Israel’s government in order to distract their own populations from noticing they were being screwed over.

Ths Supreme Court might as well prohibit unions.

My biggest problem with Obama (or maybe my second biggest) is that he didn’t put up a sufficient fight when the Senate refused to consider his Supreme Court nominee. And now look where we are.

Comment by J.P. Hart on May 23, 2018 at 11:22am

despite the depth of the great bathoscape, it must be the spiral loop of hate, sun sets secrets
so what if,
all shop vacs sounded
at once
we'd still have the noon+twelve
Picasso Prince wondering
where~what to do
with dryer lint
why'd he
walk point
when Alcoholics Animus
hath the initials
as Air America
hot lava don't lie
fiercely it goes
bye & bye
just enuff
our dream

(still trying to locate his tin of oxblood shoe polish; as curious yet @ squirrels' speed and balance upon high-tension lines; hither & yon & then gone)

Comment by mary gravitt on June 4, 2018 at 10:23am

I like Evita'a song: Don't Cry For Me Argentina--Save all you tears for yourself.....  We Americans should stop worrying about Venezuela about Venezuela's government and worry about our own.  The Socialism that Chavez created in his own country allowed the poor to see doctors for the first time in their lives.  In fact he did exactly what Jesus told his followers to do: Care for the poor and the needy and the widows in their adversity.  I am surprised that that holy-roller Pence did not remember this when he when down to South America urging Venezuela's neighbors to turn on her in her time of need. 

The CIA and the Dulles brothers did a job on all the countries in Latin America and all points South.  If there is any failure in South America, it is their faith in the United States and all that bull-shit they put out about democracy, when they have seen evidence of its duplicity in Cuba and throughout the Western Hemisphere.

Karma and it remembers what Washington forgets.


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