The Supreme Court had consolidated three cases, Epic Systems Corp. v Lewis (Docket 16-285), Ernst & Young LLP v. Morris (16-300), and National Labor Relations Board v. Murphy Oil USA, Inc. (16-307).
Section 7 of the NLRA reads, in part:[2] Employees shall have the right to self-organization, to form, join, or assist labor organizations, to bargain collectively through representatives of their own choosing, and to engage in other concerted activities for the purpose of collective bargaining or other mutual aid or protectionThis case centered on whether employee class action lawsuits fell under "other concerted activities" of NLRA's section 7.
The District Court refused to dismiss the case, arguing that Lewis' action was a protected concerted activity under Section 7 of the NLRA, and that the arbitration agreement in April 2014 violated those terms.
The Ninth Circuit reversed and remanded the District Court's decision, stating that the NLRA's Section 7 protects concerted activities, which was to be considered covered by the FAA's saving clause.
Despite this ruling, the Board found in favor of Hobson's case against Murphy Oil, still asserting the NLRA protected collective actions within the FAA's saving clause, and issued a formal complaint against the company.
All three cases were petitioned to the Supreme Court of the United States for a writ of certiorari during 2016, effectively asking the same questions related to the FAA and NLRA.
[9][10] The prospective for how the case would be resolved changed following the election of Donald Trump as President of the United States, succeeding Barack Obama.
During the Obama administration, the National Labor Relations Board agency had generally favored employees and helped to defend against unfair arbitration practices.
[11] Further, following the death of Justice Antonin Scalia, Trump's nominee for the vacant seat, Neil Gorsuch, had been confirmed in April 2017.
Ginsburg wrote that "The court today holds enforceable this arm-twisted, take-it-or-leave-it contracts—including the provisions requiring employees to litigate wage and hours claims only one-by-one.
"[13] The case had been of significant interest as tens of millions of Americans are employed under contracts that require individual arbitration over collective actions.
[14] Justice Ginsburg's dissenting opinion stated that "Congressional correction" of the majority decision was "urgently in order" to protect employees.
[16] Jonathan H. Adler and Samuel Estreicher speculated that the decision will actually benefit the majority of workers because it provides a renewed incentive to put fair arbitration agreements in place.