US Supreme Court Gives Rare Victory for Arbitration Opponents in a Narrow Case for Transportation Workers

By Sharon Gold

Over the past few decades, the US Supreme Court has become a very arbitration-friendly Court.  Indeed, in the last decade, the Court has upheld arbitration in numerous decisions.  This week, in a rare victory for arbitration opponents, the Supreme Court in New Prime Inc. v. Oliveira unanimously rejected arbitration for truck drivers who were classified as independent contractors under the narrow transportation exception.  At issue was an exception to the enforceability of arbitration clauses for “contracts of employment” of workers engaged as seamen, railroad workers or those engaged in foreign or interstate commerce under the Federal Arbitration Act.  Both parties in the case agreed that truck driver employees fell within the exception.  The questions at issue were: 1) Should the Court decide the initial issue of enforceability of arbitration or should an arbitrator; and 2) Whether the transportation exclusion applied to independent contractors rather than just employees.

The Court initially held that the decision of whether the exclusion applied was one for the Court to decide because it dealt with the statutory authority of the Court.  In another case decided by the Court this term, the Court held that the interpretation of an arbitration agreement, on the other hand, would be subject to review by an arbitrator who would then decide whether arbitration was proper.  Here, because the exclusion concerned the Court’s statutory authority to

U.S. Supreme Court Addresses Statute of Limitations in Constructive Discharge Case

By Courtney Ross Samford

On May 23, 2016, the U.S. Supreme Court ruled that the limitations period for a constructive discharge claim under Title VII runs from the date the employee gives notice of his resignation, as opposed to the employer’s alleged discriminatory behavior, in Green v. Brennan, Postmaster General, No. 14-613, 2016 WL 2945236 (U.S. May 23, 2016).  The case involves Marvin Green, who worked for the U.S. Postal Service for 35 years.  He applied for a promotion in a nearby post office, but was not selected for the position.  As an African American male, Mr. Green complained that he was passed over because of his race.

Mr. Green began experiencing problems with his supervisors shortly after filing his complaint, which culminated in two supervisors accusing him of committing a federal crime.  Following an investigation, Mr. Green and the Postal Service entered into a settlement agreement on December 16, 2009, whereby the Postal Service agreed not to pursue any criminal charges against Mr. Green in exchange for his agreement to leave his current position.  The settlement agreement allowed Mr. Green to retire or accept a position for a considerably lower salary in a different location.  Mr. Green submitted his resignation on February 9, 2010.

Forty-one days after submitting his resignation (and 96 days after signing the settlement agreement with the Postal Service), Mr. Green contacted an

Supreme Court Upholds Affordable Care Act Subsidies

By Sherry P. Porter

Today, the United States Supreme Court upheld subsidies for individuals who purchase health care insurance through all health care exchanges regardless of whether the exchange was established by a state or the federal government.  The case, King v. Burwell, is the latest ruling in a number of challenges to the Affordable Care Act (ACA).  In the 6-3 ruling, the Court stated that this ruling will prevent the destabilization of the individual health insurance market into a death spiral.

What does this mean to the average American?  If you purchase health insurance from an exchange and meet the eligibility requirements, then you may continue to receive subsidies to help pay for that coverage.  It does not matter that you are in a state exchange or a federal exchange.  So, essentially status quo.

What does this mean to the average employer?  The subsidies available through the exchanges are the triggers for the penalties that may be imposed upon certain large employers if that employer either fails to offer coverage to its full time employees or offers coverage that is not affordable or does not provide minimum value.  Had the subsidies been taken away, then employers in states with federal exchanges would likely have not been subject to the penalties because in order to be subject to a penalty, an employee would have to purchase insurance on an exchange AND receive a subsidy.  Subsidies are not available to employees if they have an appropriate offer of coverage from an employer.  So, if you are a large employer and were hoping that you would not be subject to the penalties under the ACA, you should review your policies and procedures to ensure compliance with the ACA.

United States Supreme Court to Revisit Class Action Issues

By Michelle D. Wyrick

Last week, the United States Supreme Court agreed to review Tyson Foods, Inc. v. Bouaphakeo, No. 14-1146, which gives the Court an opportunity to consider class certification questions about how damages may be proven in a class action and whether a class can include members who were not injured.

Tyson Foods is a donning and doffing case in which the lower court certified collective and class actions under the Fair Labor Standards Act and state law. The plaintiffs, who were hourly production workers at an Iowa processing facility, alleged that Tyson Foods did not adequately compensate them for time spent donning and doffing protective equipment and walking to and from their work stations. Although Tyson Foods did not record the time actually spent by each employee on these tasks, it added several minutes per shift to each employee’s paycheck to compensate them.

At trial, to prove damages, the workers relied on individual time sheets and compared them to a time study of a sample of employees who were observed donning, doffing, and walking. The jury returned a verdict for