The United States Supreme Court recently issued an important decision that may impact arbitrations of employment disputes. In AT&T Mobility LLC v. Concepcion, the Court ruled that waivers of class-wide arbitrations are permissible under the Federal Arbitration Act ("FAA"). The purpose of the FAA is to ensure the enforcement of arbitration agreements according to their terms so as to facilitate informal, streamlined proceedings. Parties may agree to limit the issues subject to arbitration, to arbitrate according to specific rules, and to limit with whom they will arbitrate. In AT&T Mobility, the Court reviewed a California state court rule that conditioned the enforcement of an arbitration agreement on the availability of class-wide arbitration. The Court held that this rule interferes with the objectives of the FAA, as the availability of class-wide arbitration is not necessary to ensure that the parties to the arbitration agreement are able to vindicate their claims. This decision, even though not in the employment context, may support employers who currently or desire to prohibit class-wide arbitration in their arbitration agreements with employees.
To learn more about this, please click here to read our Litigation alert on the ruling.
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