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By: John B. Lewis and Dustin D. Dow
This article provides step-by-step guidance to consider when enforcing arbitration agreements and class action waivers in employment cases. Arbitration agreements are agreements that force individuals to bring legal claims in arbitration, rather than in court. A class action waiver is an agreement, or a section in a broader agreement, that restricts an individual’s ability to bring a class action. Employers often include class action waivers in arbitration agreements.
This section provides guidance on the Supreme Court’s pivotal decision on the enforceability of class action waivers in Epic Sys. Corp. v. Lewis, 138 S. Ct. 1612 (2018), and subsequent cases interpreting Epic Systems . It also addresses issues to consider in analyzing whether arbitration agreements, which frequently include class action waivers, are enforceable.
U.S. Supreme Court’s Pivotal Decision in Epic Systems Corp. v. Lewis
The controversy surrounding the validity of employment arbitration agreements with class action waivers had been simmering since at least 2012. With the Supreme Court’s May 21, 2018, decision in Epic Systems , we have an answer: They “must be enforced as written” despite any provision within the National Labor Relations Act (NLRA) that suggested otherwise. 1
Prior to the Supreme Court’s Epic Systems decision, the Seventh and Ninth Circuits held that an arbitration agreement precluding collective arbitration or class actions violates Section 7 of the NLRA 2 and is unenforceable under the Federal Arbitration Act (FAA), which we address below in the section entitled “The Federal Arbitration Act.” The Seventh and Ninth Circuits were squarely at odds with the Second, Fifth, Eighth, and Eleventh Circuits, which had previously held that the FAA’s policy of favoring arbitration overrides any concerted activity rights employees have to class or collective remedies.
To read the full practice note in Lexis Practice Advisor, follow this link.
John B. Lewis is a partner in BakerHostetler’s Cleveland, Ohio office and concentrates his practice on the resolution of complex employment, labor, and regulatory disputes, including the defense and oversight of class action litigation. The majority of John’s time is devoted to litigation, appellate practice, and alternative dispute resolution procedures involving federal and state anti-discrimination, wage and hour, and fair housing laws, the Railway Labor Act, the Civil Rights Acts, the Federal Reserve Act, and the Employee Retirement Income Security Act, as well as wrongful discharge, trade secret, non-competition, and work-related tort claims. He has participated in more than 90 cases before federal and state appellate courts, including the filing of amicus briefs in the U.S. Supreme Court. Dustin D. Dow focuses his practice on nationwide class actions, employment representation, and insurance coverage. With comprehensive litigation experience, Dustin manages clients’ needs throughout the litigation process, from pre-discovery to appeals. As the editor of the firm’s annual class action review, Dustin is continually abreast of the most recent and relevant trends affecting companies dealing with potential class action liability.
For non-jurisdictional and state-specific annotated arbitration agreements, see
> THE ARBITRATION AGREEMENTS COLUMN OF EMPLOYMENT LITIGATION STATE EXPERT FORMS AND CHECKLISTS CHART
> Labor & Employment > Employment Litigation > Other Employment Litigation > Forms
For more labor and employment arbitration practical guidance, see
> THE EMPLOYMENT LITIGATION / ARBITRATION PRACTICE NOTES PAGE
> Labor & Employment > Employment Litigation > Arbitration > Practice Notes
For guidance on seeking a delay in federal court pending arbitration, see
> MOTION FOR A STAY PENDING ARBITRATION: MAKING THE MOTION (FEDERAL)
> Civil Litigation > Arbitration and Other ADR > Practice Notes
For an explanation on how to seek a court order to compel a party to participate in arbitration, see
> MOTION TO COMPEL ARBITRATION: MAKING THE MOTION AND APPEALING AN ADVERSE RULING (FEDERAL)
For information on the requirements for motion practice in federal court, including motions to stay pending arbitration, see
> MAKING AND OPPOSING A MOTION (FEDERAL)
> Civil Litigation > Motions > Motion Practice Fundamentals > Practice Notes
For a discussion on California’s Private Attorneys General Act (PAGA), see
> PRIVATE ATTORNEYS GENERAL ACT IN CALIFORNIA: DEFENDING AGAINST PAGA CLAIMS
> Labor & Employment > Employment Litigation > Class and Collective Actions > Practice Notes
1.Epic Systems, 138 S. Ct. at 1632. 2. 29 U.S.C.S. § 157.