41 F. Supp. 3d 1327
M.D. Ala.2014Background
- Forty-five former Groome Transportation employees sue for FLSA overtime and WARN Act violations.
- Groome seeks to compel arbitration under a one-page Arbitration Agreement added to the Personnel Policy Handbook around Oct 2012.
- Arbitration requires binding arbitration in Richmond, Virginia, under AAA Mediation Rules; a signed acknowledgment appears only for Annie L. Adams; Cassandra Young refused to sign.
- Groome argues continued employment constitutes acceptance of the arbitration terms; Groome’s records do not show a handbook provision explicitly stating this.
- Plaintiffs allege overtime was not properly paid in 2012 and that Groome failed to provide 60-day WARN Act notice; Groome closed its Lee County, Alabama facility in 2013.
- Court must decide whether there is a written agreement to arbitrate and whether the 44 non-signing Plaintiffs are bound, plus whether the arbitration is enforceable.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether there is a written arbitration agreement as to each plaintiff | Adams signed; others did not sign; no written agreement for 44 plaintiffs | Arbitration clause in handbook is written; signature not required for all | Adams has a written agreement; 44 others’ written agreement not proven |
| Whether the arbitration agreement is enforceable under mutual assent | Alabama law requires mutual assent; no written sign-off for most plaintiffs | Continued employment may show assent; signatures are not mandatory | Not proven for 44 plaintiffs; Adams shows assent; unenforceability not established for others |
| Whether the arbitration clause requires arbitration of federal statutory claims (scope) | Plaintiffs’ FLSA/WARN claims not covered or improperly scoped | Clause covers any dispute; includes federal statutory claims | Arbitration clause broadly covers FLSA and WARN Act claims |
| Who decides arbitrability and where trial should occur | Arbitrability questions should be decided by the court | Arbitrator should decide arbitrability under delegation | Court decides all arbitrability questions; bench trial for forty-four as to making of arbitration |
Key Cases Cited
- First Options of Chicago, Inc. v. Kaplan, 513 U.S. 938 (Supreme Court, 1995) (who decides arbitrability; unless clear delegation, court decides gateway questions)
- Terminix Int’l Co., L.P. v. Palmer Ranch Ltd. P’ship, 432 F.3d 1327 (11th Cir. 2005) (incorporation of AAA rules can delegate arbitrability to arbitrator)
- Coley v. Gulfstream Aerospace Corp., 428 F.3d 1359 (11th Cir. 2005) (written agreement requirement can be satisfied without signature)
- Caley v. Gulfstream Aerospace Corp., 428 F.3d 1359 (11th Cir. 2005) (continued employment can constitute assent when policy so provides)
- Paladino v. Avnet Computer Technologies, Inc., 134 F.3d 1054 (11th Cir. 1998) (any disputes includes federal statutory claims under FAA §2)
- Italian Colors Restaurant v. Cooper, 133 S. Ct. 2304 (2013) (class-arbitration waiver under FAA generally enforceable (Concepcion lineage))
- AT&T Mobility LLC v. Concepcion, 563 U.S. 333 (2011) (FAA preempts state rules that prohibit class arbitration; supports enforcement of arbitration)
- Stolt-Nielsen S.A. v. AnimalFeeds Int’l Corp., 559 U.S. 662 (2010) (cannot infer class-action rights from silence in arbitration clause)