Tuesday, June 20, 2006

Mandatory arbitration provision violates US National Labor Relations Act

Mandatory arbitration provisions held to violate National Labor Relations ActRoss Runkel in both his arbitration blog and his employment law blog reports this week that the U.S. National Labor Relations Board has held in U-Haul Company of California (NLRB 06/08/2006) (2-1) that a mandatory arbitration policy adopted by a non-union company violates the National Labor Relations Act.

Ross's analysis of this decision and its limited implications can be found here. Ross points out that this decision does not invalidate U-Haul’s mandatory arbitration policy in it entirety, but only the extent to which it affects NLRB claims.

Regular readers of this blog know that I am no fan of mandatory arbitration provisions in consumer, health care, and employment agreements.

For the reasons why, please read either of these posts: "The company we keep: ADR, tort reform, and the erosion of justice," and "30 years after the Pound Conference: reflections on ADR and justice in the 21st century".

For a detailed exploration of the issues associated with mandatory arbitration provisions from the perspective of the U.S. Equal Employment Opportunity Commission, the governmental body charged with enforcement of federal anti-discrimination laws, please consider the "Policy Statement on Mandatory Binding Arbitration of Employment Discrimination Disputes as a Condition of Employment" issued in 1997. The EEOC, a supporter of voluntary alternative dispute resolution, takes the position that mandatory arbitration provisions in employment agreements violate the fundamental principles of employment discrimination laws in large part due to the extent to which such policies shield employers from public accountability.