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Mandatory Arbitration and the Supreme Court - The First of Potentially Many New Days

By Michael W. Fox, Esq.

As Justice Scalia''s body lies in state in the Great Hall of the Supreme Court this morning, my eye was caught by the first headline in today's Employment Law 360.

The headline and lead:

5th Circ. Starts Clock For NLRB Appeal Of Murphy Oil Ruling

The Fifth Circuit on Thursday issued its judgment based on its October opinion that mostly reversed a National Labor Relations Board ruling that had found Murphy Oil arbitration agreements barring workers from pursuing class or collective actions as unlawful, setting the stage for a potential NLRB appeal.

The case of course deals with whether a mandatory arbitration provision violates the National Relations Act.  That has been the position of the NLRB for some time now, notwithstanding almost universal rejection by the courts.  The first time its view was subjected to judicial review, the 5th Circuit rejected the position in a 2-1 decision, D.R. Horton, Inc. v. NLRB (5th Cir. 2013). Notwithstanding the split decision, the Board passed on seeking review by the Supreme Court.

With yesterday's issue of a judgment by the 5th Circuit in another rebuff to the NLRB, it now has a second chance.  Last October the Court noting that the Board's request for an en banc review of its D.R. Horton decision having failed, the Board would not be surprised that the Court "would adhere, as we must, to our prior ruling," holding that Murphy Oil "did not commit unfair labor practices by requiring employees to sign its arbitration agreement or seeking to enforce that agreement in federal district court."  Murphy Oil, Inc. v. NLRB, (5th Cir. 2015).

However, because of some other issues it was the Court's judgment issued yesterday which started the clock running for appeal to the Supreme Court.  And of course between the ruling on October 15th and yesterday's judgment, the legal world has changed.

Under the Court as it existed both at the time of the D.R. Horton decision or even in October when Murphy Oil  was decided, employers would not have been terribly concerned if the NLRB had appealed.

Today? At least for me, this is the first of what I am sure will be many times as the political process which will produce the next Justice of the Supreme Court grinds slowly that the question will be a much more serious one as to what the world could look like than it was this time last week.

Full post as published by Jottings By An Employer's Lawyer on February 19, 2016 (boomark / email).