Convergys Corp. v. National Labor Relations Board
866 F.3d 635
| 5th Cir. | 2017Background
- Convergys required job applicants to sign an agreement waiving the right to pursue class or collective legal claims (no arbitration clause present in the agreement at issue).
- An employee who signed the waiver brought class/collective FLSA claims; Convergys moved to strike/enforce the waiver in federal court; the motion was denied and the suit later settled.
- The employee filed unfair-labor-practice charges with the NLRB alleging Convergys unlawfully interfered with Section 7 rights by requiring and enforcing the waiver.
- The NLRB General Counsel issued a complaint; an ALJ and the Board majority found violations under Section 8(a)(1), relying on the Board’s view that Section 7 protects the right to pursue class/collective actions.
- Convergys petitioned for review in the Fifth Circuit; the Fifth Circuit granted review, held it was bound by its precedent in D.R. Horton, and vacated/enjoined enforcement of the NLRB order.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether Section 7 of the NLRA protects a substantive right to participate in class or collective actions | Employee/NLRB: Section 7’s “other concerted activities” includes collective litigation; waivers interfere with that right | Convergys: No substantive Section 7 right to use class/collective procedures; waiver lawful | Court: Section 7 does not guarantee a substantive right to class/collective procedures (procedural only) |
| Whether requiring applicants to sign a class/collective-action waiver violates Section 8(a)(1) | Employee/NLRB: Requiring the waiver unlawfully interferes with Section 7 rights | Convergys: Requiring the waiver does not violate Section 8(a)(1) under Fifth Circuit precedent | Court: No Section 8(a)(1) violation for requiring the waiver |
| Whether enforcing the waiver in litigation violates Section 8(a)(1) | Employee/NLRB: Seeking to enforce the waiver unlawfully restrains concerted activity | Convergys: Enforcement is permitted; Horton controls | Court: Enforcement did not violate Section 8(a)(1) |
| Whether Board’s order should be enforced against Convergys | NLRB: Board order should be enforced (waiver unlawful) | Convergys: Fifth Circuit precedent requires denial of enforcement | Court: Denied enforcement and granted Convergys’ petition for review |
Key Cases Cited
- D.R. Horton, Inc. v. NLRB, 737 F.3d 344 (5th Cir. 2013) (holds class/collective-action procedures are procedural rather than substantive under Section 7; arbitration waivers enforceable)
- Murphy Oil USA, Inc. v. NLRB, 808 F.3d 1013 (5th Cir. 2015) (applies Horton; finds no NLRA conflict with FAA; certiorari noted)
- Eastex, Inc. v. NLRB, 437 U.S. 556 (1978) (recognizes §7 protects concerted activities beyond collective bargaining, including resort to administrative/judicial fora in dicta)
- Altex Ready Mixed Concrete Corp. v. NLRB, 542 F.2d 295 (5th Cir. 1976) (recognizes filing of labor-related civil action by employees can be protected concerted activity)
- AT&T Mobility LLC v. Concepcion, 563 U.S. 333 (2011) (FAA treats arbitration agreements on equal footing with other contracts)
- Gilmer v. Interstate/Johnson Lane Corp., 500 U.S. 20 (1991) (statutory claims may be subject to arbitration without forfeiting substantive rights)