In Johnmohammadi v. Bloomingdale’s, ___ F.3d ___ (9th Cir. June 23, 2014), the Ninth Circuit Court of Appeals affirmed the order of the U.S. District Court for the Central District of California (Judge Wu) compelling arbitration of, and dismissing without prejudice, a class action brought by a former employee to recover unpaid overtime wages.
Plaintiff was a sales associate for defendant employer who, when she was hired, received a set of documents in which she acknowledged that she agreed to resolve all employment-related disputes through arbitration and waived her right to assert class action claims. Importantly, when plaintiff received those documents, she was given the opportunity to “opt out” of the arbitration agreement but did not do so. Consequently, defendant moved to compel arbitration of her claims and dismiss the class action. Plaintiff argued that the class action waiver was unenforceable because it violated the Norris-LaGuardia Act, 29 U.S.C. § 101 et seq. and the National Labor Relations Act, 29 U.S.C. § 151 et seq. (“NLRA”), both of which essentially prohibit employers from interfering, restraining or coercing employees from engaging in concerted activity or unionizing. According to plaintiff, filing the class action on behalf of her fellow employees was, in fact, such a concerted activity.
The appellate court agreed, finding that the arbitration agreement was valid, and under the Federal Arbitration Act it must be enforced according to its terms. Furthermore, plaintiff “had the right to opt out of the arbitration agreement, and had she done so she would be free to pursue this class action in court. Having freely elected to arbitrate employment-related disputes on an individual basis, without interference from [defendant], she cannot claim that enforcement of the agreement violates either the Norris-LaGuardia Act or the NLRA.”