From the Bingham Greenbaum Doll LLP blog, April 16, 2013
" . . . . Many wage and hour claims pose little risk when they are brought individually by a single employee. This is because most employees proceeding alone will have relatively small damages and, thus, it might not be cost-effective for them to pursue legal action. These same claims, however, can give rise to major litigation when many similarly situated employees join together as a group. For this reason, many wage and hour claims never get filed unless they can proceed as class or collective action lawsuits. Employers now may be able to block these group lawsuits.The Supreme Court reference is likely to AT&T Mobility LLC v. Concepcion, 131 S. Ct. 1740, 563 US 4, 179 L. Ed. 2d 742 (2011).
"Approximately two years ago, the U.S. Supreme Court held that states could not prohibit parties from waiving their rights to pursue class and collective actions. This left the question of whether federal labor law could prohibit these ‘class and collective-action waivers;’ however, over the last year, many courts have held that it does not. (Kentucky courts have not addressed this topic, but there is a good chance they will find these employer-friendly decisions persuasive.) These courts effectively opened the door for employers to require class and collective waivers as a condition of employment, and thus bar employees from pursuing large-scale wage and hour claims, and also prevent many smaller claims from being filed in the first place.. . . "
Also, on June 20, 2013, the Court ruled in American Express Co. v. Italian Colors Restaurant, 133 S. Ct. 1236 (2013) that class action waivers contained in mandatory arbitration clauses were valid even if plaintiffs prove that it would not be economically practicable to maintain these actions individually.
Neither of these cases involved wage and hour disputes. Neither case involved employment agreements. Each of the Supreme Court cases arose in the context of binding arbitration agreements. In AT&T Mobility LLC v. Concepcion the court praised not only the benefits of arbitration in general, but also the ease and efficiency of the alternate dispute resolution procedures actually in place under the circumstances of the case.
The Amreican Express case discounted the relevance of economical and practical alternatives.
There seems to be a big difference between waiving the right to pursue a class action in the context of an arbitration agreement, and the use to class action waivers as a condition of hourly employment, outside a collective bargaining agreement.
I never though about it before today, but I am not as optimistic as Bingham Greenbaum Doll with the use of class action waivers for wage & hour claims in employment agreements. I have doubts.
Note to self: Look deeper.