Dive Brief:
- A group of workers suing Fiat Chrysler Automobiles for race discrimination will have to take their claims to individual arbitration, a Michigan federal trial court has ruled (Williams v. FCA US LLC, No. 17-10097 (E.D. Mich., May 24, 2018)). The plaintiffs, current and former employees, sued the company alleging that an employee evaluation policy has a disparate, negative impact on African-American employees.
- Relying on the U.S. Supreme Court's recent decision in Epic Systems Corp. v. Lewis, the district court ordered all but two of the the plaintiffs into arbitration, finding that they agreed to abide by Fiat’s employment dispute resolution process when they were hired. “Given the Supreme Court’s decision in Epic, the Court must uphold the arbitration agreements,” the district court said. The two plaintiffs who were excluded were hired before the company implemented its arbitration policy in 1995, the court said.
- The High Court's decision also has affected a suit involving United Healthcare; the case, pending at the Supreme Court, has now been remanded to the 7th Circuit.
Dive Insight:
The effects of last week's Epic opinion are already being felt across the country. These are undoubtedly the first of many decisions to come that apply the High Court’s 5-4 decision allowing employers to compel workers to resolve employment disputes through individual arbitration rather than class or collective actions.
Employers largely saw the decision as a win, allowing them to avoid some of the expenses that can result from class litigation. Critics, however, have warned that allowing employers to block employees from banding together as a class for legal disputes could have dire consequences for discrimination and sexual harassment claims. Heidi Burakiewicz, a partner with Kalijarvi, Chuzi, Newman & Fitch told HR Dive in an email that the decision is "a step backward to eradicating discrimination and sexual harassment (and wage theft and everything else). So much for #MeToo. I fear that some employers will (and already do) view it as a free ticket to discriminate without repercussion."
On the other hand, some say the #MeToo movement could have enough influence to prompt a “carve out” for sexual harassment claims. Sen. Kristen Gillibrand (D-NY) introduced the “Ending Forced Arbitration of Sexual Harassment Act of 2017” in December 2017. The bipartisan legislation would, among other things, render unenforceable agreements that require arbitration of sexual harassment and discrimination claims and allow survivors of sexual harassment or discrimination to discuss their cases publicly, Gillibrand and Lindsay Graham (R-SC) said in a statement announcing the bill. Similar bills have been introduced in the U.S. House of Representatives.