In MasTec Services Co. Inc., Case. No. 16-CA-086102 (“MasTec”), an NLRB Administrative Law Judge (“ALJ”) added an additional twist to the already controversial NLRB decision D.R. Horton Inc., 357 N.L.R.B. No. 184 (Jan. 3, 2012). In D.R. Horton, the Board decided that a mandatory arbitration agreement that precludes an employee from participating in class or collective actions violates Section 8(a)(1) of the National Labor Relations Act (“NLRA”) — a decision that has been heavily criticized. But on June 3, the ALJ in MasTec took D.R. Horton one step further, concluding that providing employees with the chance to opt out of such a provision still violates employee rights under federal law.
MasTec, the employer at the center of the ALJ’s decision, required employees to sign a form in which they acknowledged that they would be bound to a dispute-resolution policy set forth in the employee handbook. That policy required employees to resolve any disputes through individual arbitration, and further prevented employees from seeking redress for any claims through collective or class-action lawsuits. However, MasTec allowed employees to opt out of the dispute-resolution policy if they did so on a separate form provided by the company within thirty days of receiving the employee handbook. Additionally, unlike in D.R. Horton, MasTec’s policy authorized employees to bring claims to administrative agencies.
Arguably, MasTec’s dispute-resolution policy was more “employee-friendly” than the one at issue in D.R. Horton; after all, the policy in D.R. Horton did not allow employees to opt out, if they so wished. Nevertheless, the ALJ concluded that “an employer may not lawfully require its employees to affirmatively act (opt out, in writing, within thirty days of receipt of the Employee Handbook) in order to obtain or maintain these rights.” As the ALJ explained, employees who did opt out would be precluded from engaging in protected concerted activity by virtue of their inability to cooperate with employees who did not opt-out, and thus would be disadvantaged. Furthermore, the ALJ continued, even though MasTec had instituted a method for obtaining and returning opt-out forms so as to prevent management from learning the identities of those employees who chose to opt-out, employees may be reluctant to exercise their opt out rights for fear of reprisals by MasTec.
The ALJ’s decision in MasTec demonstrates a continued desire to follow the much-maligned decision in D.R. Horton, and an intention to extend D.R. Horton‘s reach to include non-mandatory arbitration agreements. Careful consideration should continue to be given to any arbitration agreements issued to employees.