Bucking the jurisprudence of nearly 40 federal and state courts, in Murphy Oil USA, Inc., the National Labor Relations Board (“NLRB”) revisited—and a majority reaffirmed—the rationale in its D.R. Horton decision. In D.R. Horton, the NLRB found that mandatory, pre-employment arbitral waivers of class, collection and joint claims regarding wages, hours and working conditions violated “concerted activity” protections under the National Labor Relations Act. See February 2012 FEB. That decision has been widely criticized in federal and state courts. At least one California appellate court expressly rejected the NLRB’s rationale in D.R. Horton. See June 2012 FEB. Indeed, on appeal from the NLRB’s D.R. Horton decision, the United States Court of Appeals for the Fifth Circuit similarly rejected the rationale and refused to enforce the NLRB’s order requiring D.R. Horton to rescind the waiver. See December 2013 FEB.
Murphy Oil includes a strongly-worded dissent and a scathing commentary on the decision that lays the groundwork for future challenges. NLRB member Harry I. Johnson, III characterizes the majority’s decision as an “unfortunate example of a Federal agency refusing to follow the clear instructions of our nation’s Supreme Court on the interpretation of the statute entrusted to our charge, and compounding that error by rejecting the Supreme Court’s clear instructions on how to interpret the Federal Arbitration Act, a statute where the [NLRB] possesses no special authority or expertise.” He goes on to accuse the majority of “effectively ignoring the opinions in nearly 40 Federal and State courts” and “choos[ing] to double down on a mistake that, by now, is blatantly apparent.”
Given the volume of cases pending before the NLRB on this same issue and the polarized approaches of the NLRB and federal and state courts, the Murphy Oil decision is not likely to be the last word on this issue. Stay tuned for further developments.