IN THE MATTER OF THE ARBITRATION BETWEEN * AAA CASE NO.: * * *

Transcription

1 IN THE MATTER OF THE ARBITRATION BETWEEN * AAA CASE NO.: * * * JAMES SULLIVAN * CLAIM: FAIR LABOR STANDARDS * ACT * * AND * * CLAIMANT: JAMES SULLIVAN * * PJ UNITED, INC. AND * DOUG STEPHENS * ARBITRATOR S FILE NO: INTERIM ORDER ARBITRATOR: JACK CLARKE INTERIM DECISION DATE: DECEMBER 12, 2014 APPEARANCES FOR THE PARTIES CLAIMANT Mark A. Potashnick, Esq., Weinhaus & Potashnick, St. Louis, Missouri Richard M. Paul III, Esq., Paul McInnes, LLP, Kansas City, Missouri Jack D. McInnes, Esq., Paul McInnes, LLP, Kansas City, Missouri W. Lewis Garrison, Jr., Esq., Henninger Garrison Davis, LLC, Birmingham, Alabama William L. Bross, Esq., Henninger Garrison Davis, LLC, Birmingham, Alabama Brandy Robertson, Esq., Henninger Garrison Davis, LLC, Birmingham, Alabama Taylor C. Bartlett, Esq., Henninger Garrison Davis, LLC, Birmingham, Alabama EMPLOYER William K. Hancock, Esq., Galloway, Scott, Moss & Hancock, LLC, Birmingham, Alabama

2 PROCEDURAL HISTORY/FACTS PJ United, Inc., PJ Cheese, Inc. and Douglas Stephens are hereinafter referred to collectively as Employer. James Sullivan is hereinafter referred to as Claimant. PJ Cheese, Inc. employed Claimant at certain times. PJ Cheese, Inc. is a wholly owned subsidiary of PJ United, Inc. Douglas (Doug) Stephens is an officer of PJ United, Inc. and PJ Cheese, Inc. The issues involved in this case were raised not only in this arbitration but also in a civil action in Federal court and in a National Labor Relations Board (NLRB) administrative action. Several of the facts set out above and below are based on findings in the Decision by NLRB Administrative Law Judge William Nelson Cates dated June 6, Common to all three cases are the arbitration agreements and Dispute Resolution Program Booklet noted hereafter. On November 30, 2010, Claimant and Douglas S. Stephens signed a document entitled Agreement and Receipt for Dispute Resolution Program (hereinafter Arbitration Agreement ), which reads in part: I have received a copy of the Dispute Resolution Program of PJ United, Inc., PJ Cheese, Inc., PJ Louisiana, Inc., PJ Chippewa, LLC, Ohio Pizza Delivery, Inc., and PJ Utah. LLC., their successors and assigns (the Company ), and have read and understood its contents. However, I understand that I am employed only by the particular corporation listed above which actually provides my employment and the benefits thereof, and not by any other above listed corporation. I understand that my employment is at-will and such employment is not for a fixed term or definite period and may be terminated of the will of either party, with or without notice. I recognize that differences may arise between the Company and me during or following my employment with the Company, and that those differences may or may not be related to employment. I understand and agree that any such differences will be resolved as provided In the Dispute Resolution Policy. Page 1

3 MUTUAL PROMISE TO RESOLVE CLAIMS BY BINDING ARBITRATION. The Company and I agree that all legal claims or disputes covered by the Agreement must be submitted to binding arbitration and that this binding arbitration will be the sole and exclusive final remedy for resolving any such claim or dispute. I also agree that any arbitration between the Company and me is of an individual claim and that any claim subject to arbitration will not be arbitrated on a multi-claimant, a collective or a class-wide basis. The mutual obligations set forth in this Agreement shall constitute a contract between the Employee and the Company but shall not change an Employee s at-will relationship or any term of any other contract or agreement between the Company and Employee, This Policy shall constitute the entire agreement between the Employee and Company for the resolution of Covered Claims. The submission of an application, acceptance of employment or the continuation of employment by an individual shall be deemed to be acceptance of the dispute resolution program. No signature shall be required for the policy to be applicable. Legally protected rights covered by this Dispute Resolution Program are all legal claims, including: claims for wages or other compensation; claims for breach of any contract, covenant or warranty (expressed or implied): tort claims (including, but not limited to, claims for physical, mental or psychological injury, but excluding statutory workers compensation claims); claims for wrongful termination; sexual harassment; discrimination (including, but not limited to. claims based on race, sex. religion, national origin, age, medical condition or disability, whether under federal, state or local law); claims for benefits or claims for damages or other remedies under any employee benefit program sponsored by the Company (after exhausting administrative remedies under the terms of such plans); whistleblower claims under any federal, state or other governmental law, statute, regulation or ordinance; and claims for a violation of any other non-criminal federal, state or other governmental law, statute, regulation or ordinance; and claims for retaliation under any law, statute, regulation or ordinance, including retaliation under any workers compensation law or regulation. I understand and agree that by entering into this Agreement, I anticipate gaining the benefits of a speedy, impartial dispute resolution procedure. This procedure is explained in the Dispute Resolution Program Booklet, which I acknowledge I have received and read or have had an opportunity to read. MULTI-STATE BUSINESS. I understand and agree the Company is engaged in transactions involving interstate commerce and that my Page 2

4 employment Involves such commerce. I agree that the Federal Arbitration Act shall govern the interpretation, enforcement, and proceedings under this Agreement. SOLE AND ENTIRE AGREEMENT. This Agreement and the Dispute Resolution Program Booklet are the complete agreement of the parties on the subject of arbitration of disputes... This agreement is binding upon, and shall inure to the benefit of the parties hereto and their successors and assigns, and upon all persons and entities who or which, directly or indirectly control, are controlled by, or are under common control with the parties. NOT AN EMPLOYMENT CONTRACT. While this Agreement is a binding promise between the Company and me to arbitrate all claims in dispute described in the Program Booklet, this Agreement is not and shall not be construed to create any contract of employment, expressed or implied. Nor does this Agreement In any way alter the at-will status of my employment. VOLUNTARY AGREEMENT. I acknowledge that I have carefully read this Agreement, I understand its terms, that all understandings and agreements between the Company and me relating to the subjects covered in this Agreement are contained in It, and that I have entered into the Agreement voluntarily and not in reliance on any other promises or representations by the Company other than those in the Agreement Itself and the Dispute Resolution Program. I further acknowledge and agree that I have been given the opportunity to discuss this Agreement with my own private lawyer and have used that opportunity to the extent that I wish to do so. This Agreement shall apply to me, my representatives, executors, administrators, guardians, heirs and assigns in any action where a claim could be brought. 1 The Dispute Resolution Program Booklet noted in the Agreement provides in part: This Dispute Resolution Program is adopted for PJ United, Inc., PJ Cheese, Inc., PJ Louisiana, LLC, PJ Chippewa, LLC, PJ Utah, LLC, and Ohio Pizza Delivery Company, all of which are collectively hereinafter referred to as the Company. 1 Claimant and Stephens executed an identical document on May 28, Page 3

5 However, each employee understands that he/she is employed only by the particular corporation listed above that actually provides the employee s employment and the benefits thereof, and not by any other above listed corporation.. [W]e developed the DISPUTE RESOLUTION PROGRAM (the Program ). The Program is a four-step process for resolving workplace problems quickly and fairly. This policy describes the steps that both you and the Company must take to resolve many types of workplace problems. The Company is also obligated to follow the Program and will also be bound by arbitration. The types of problems covered by the Program are explained in detail in this policy. THIS PROGRAM IS A CONDITION OF YOUR EMPLOYMENT AND IS THE MANDATORY AND EXCLUSIVE MEANS BY WHICH THOSE PROBLEMS MAY BE RESOLVED, SO READ THE INFORMATION IN THIS PROGRAM BOOKLET CAREFULLY.. Step 4: Arbitration If you have a work-related problem that involves one of your legally protected rights shown on page 4, which has not been resolved through the earlier steps, you must request arbitration. In arbitration, an outside neutral expert called an arbitrator becomes involved in the resolution process. He or she listens to the facts, then makes a final binding decision and awards any damages, just like a judge in a court of law. Arbitration is less formal than conventional court litigation but is clearly established and governed by rules and standards of conduct, which are designed to assure due process of law is fully protected. However, the goal of arbitration is still to provide quick problem resolution without damaging the working relationship. Here is how the arbitration process works: 1. Request arbitration. If you believe you have a legal claim, you must request that your claim go to arbitration. Simply complete an Arbitration Request form and return it to the Company at 2300 Resource Drive, Birmingham, Alabama addressed to the attention of the Employee Relations Coordinator... Page 4

6 2. Choose an arbitrator. Once the MA receives your request to begin arbitration, it will send both you and the Company a list of approved arbitrators with a brief biography on each. Once you receive the list, you and the Company each remove the names of any arbitrators that you do not want to hear the case, list in order of preference the remaining arbitrators, and then return the list to the agency. The arbitrator who has received the highest ranking in order of preference from both lists shall be assigned. If this process does not result in the selection of an arbitrator, the agency will appoint an arbitrator. 3. A hearing is set. The agency arbitrator will schedule a date, time and place for a hearing. During this hearing, both you and the Company present the pertinent facts. You may hire a lawyer to participate in the arbitration hearing with you. The hearing will be conducted in the community where you are employed or in another mutually agreeable location. 4. A decision is made. Based on the information presented and the facts gathered, the arbitrator will make a final binding decision in writing. The decision of the arbitrator shall have preclusive effect with respect to any subsequent litigation. If you win, the arbitrator can award you anything you might seek through a court of law. By using arbitration, your rights are protected and damages can be paid if those rights have been violated. It is only the process that is different. Program Rules Claims Subject to Arbitration Claims and disputes subject to arbitration include all those legal claims you may now or in the future have against the Company (and its successors or assigns) or against its officers, directors, shareholders, employees or agents, including claims related to any Company employee benefit program or against its fiduciaries or administrators (in their personal or official capacity), and all claims that the Company may now or in the future have against you, whether or not arising out of your employment or termination, except as expressly excluded under the Claims Not Subject to Arbitration section below. The legal claims subject to arbitration include, but are not to be limited to: claims for wages or other compensation; claims for breach of any contract, covenant or warranty (expressed or implied); Page 5

7 tort claims (including, but not limited to, claims for physical, mental or psychological injury, but excluding statutory workers compensation claims); claims for wrongful termination; sexual harassment; discrimination (including, but not limited to, claims based on race, sex, sexual orientation, religion, national origin, age, medical condition or disability whether under federal, state or local law); claims for benefits or claims for damages or other remedies under any employee benefit program sponsored by the Company (after exhausting administrative remedies under the terms of such plans); whistleblower claims under any federal, state or other governmental law, statute, regulation or ordinance; claims for a violation of any other non-criminal federal, state or other governmental law, statute, regulation or ordinance; and claims for retaliation under any law, statute, regulation or ordinance, including retaliation under any workers compensation law or regulation. Claims Not Subject to Arbitration The only claims or disputes not subject to arbitration are as follows: any claim by an employee for benefits under a plan or program which provides its own binding arbitration procedure; any statutory workers compensation claim; and unemployment insurance claims. Neither the employee nor the Company has to submit the items listed under this Claims Not Subject to Arbitration caption to arbitration under this Program and may seek and obtain relief from a court or the appropriate administrative agency. The parties also agrees that any arbitration between the employee and the Company is their individual claim and that any claim subject to arbitration will not be arbitrated on a collective or a class-wide basis; provided however, that this provision shall not apply to any prospective class or collective action based on alleged violations of wage and hour laws if, and only if, such claim should cause the agreement to arbitrate to be unenforceable under the prevailing law. Page 6

8 Also, any non-legal dispute is not subject to arbitration. Examples include disputes over a performance evaluation, issues with co-workers, or complaints about your work site or work assignment which do not allege a legal violation. Required Notice of All Claims When seeking arbitration, the claimant must file the Request for Arbitration form and give written notice of any claim to the other party within one year or within the applicable statute of limitations, whichever is longer. The day the act complained of occurred shall be counted for purposes of determining the applicable period. Use the Request for Arbitration form when submitting a claim for arbitration. Identify and describe the nature of all claims asserted and the facts on which your claims are based. Send this written notice by certified or registered mail, return receipt requested. If the Company wishes to invoke arbitration, it will give written notice to you at the last address recorded in the Company s payroll records. Clamant, individually and on behalf of other similarly situated persons, initiated the Federal court action noted above by filing a Complaint in the United States District Court for the Northern District of Alabama, Western Division, on July 9, 2013 against PJ United, Inc. and Douglas Stephens as Defendants. 2 Claimant alleged, inter alia, that he and all other similarly situated delivery truck drivers work or previously worked for Papa John s restaurants owned and operated by Defendants. Claimant stated: This lawsuit is brought as a collective action under the Fair Labor Standards Act (FLSA) 29 U.S.C. 201 et seq., to recover unpaid minimum wages owed to Plaintiff and all other similarly situated workers employed by Defendants. Employer initiated the present arbitration by filing an Employment Arbitration Rules Demand for Arbitration with the Voorhees, New Jersey office of the American Arbitration Association on July 22, 2013, wherein they identified Claimant as Claimant. 2 Case 7:13-cv LSC (filed July 9, 2013). Page 7

9 The AAA notified the undersigned of his appointment by dated September 12, At some point in time, Defendants filed a Motion to Stay Proceedings Pending Arbitration in the Federal court action, wherein they asked not only that the Court stay that action pending arbitration but also that the Court direct that the Claimant could pursue arbitration only on a single claimant basis. On September 10, 2013, USDC Judge L. Scott Coogler granted the motion to stay pending arbitration but declined to order that the arbitration proceed on a single claimant basis only, stating that was an issue for the arbitrator to decide. Claimant initiated the administrative action noted above by filing a Charge with the NLRB on September 23, Following a hearing, Administrative Law Judge William Nelson Cates issued a Decision dated June 6, He wrote in part: As noted elsewhere, here the complaint alleges the Company has violated Section 8(a)(1) of the Act by, since about January 2010, maintaining and enforcing its mandatory arbitration policy that unlawfully prohibits employees from engaging in protected concerted activities, and, that leads employees reasonably to believe that they are prohibited from filing charges with the Board.. The Company s mandatory arbitration policy explicitly restricts activities protected by Section 7 of the Act and, as such, is unlawful under Section 8(a)(1) of the Act. In this regard the Board in D. R. Horton, Inc., supra slip op. at 13, held an employer violates Section 8(a)(1) of the Act by requiring employees [as here] to waive their right to collectively pursue employment related claims in all forums, arbitral and judicial. The Board noted at 10 The right to engage in collective action including collective legal action is the core substantive right protected by the NLRA and is the foundation on which the Act and Federal labor policy rests. Stated 3 After receiving notice of his appointment, the undersigned made certain disclosures. The AAA notified the undersigned by dated September 26, 2013 that it had received no objections to his appointment. Page 8

10 differently, the Board in D. R. Horton, Inc., supra determined that as a condition of employment employers may not compel employees to waive their NLRA right to collectively pursue litigation of employment claims in all forums arbitral and judicial. D. R. Horton, Inc., slip op. at 12. The General Counsel also alleges the mandatory arbitration policy leads employees reasonably to believe that they are prohibited from filing charges with the Board. I agree. The agreement language, which in part, states: The Company and I agree that all legal claims and disputes covered by the agreement must be submitted to binding arbitration and that this binding arbitration will be the sole and exclusive final remedy for resolving any such claim or dispute would lead employees to reasonably believe that employment, wage, discrimination, and termination issues must be submitted exclusively to binding arbitration and not to the Board. The only employment issues not subject to the mandatory arbitration policy here involves workers compensation and unemployment insurance claims or any benefit plan that has its own arbitration procedure. Simply stated the language of the mandatory arbitration policy here may reasonably be construed, by employees, to restrict them from, concertedly or individually, filing charges under the NLRA and such interferes with the employees Section 7 rights and violates Section 8(a)(1) of the Act. Judge Cates reached the following conclusions of law (excluding the jurisdictional finding): 2. By maintaining a mandatory arbitration policy, that waives the right of its employees to maintain class or collective actions in all forums, judicial or arbitral, the Company has engaged in unfair labor practices affecting commerce within the meaning of Section 2(6) and (7) of the Act and violates Section 8(a)(1) of the Act. 3. By maintaining a mandatory arbitration policy, that leads employees reasonably to believe they are prohibited from filing charges with the National Labor Relations Board the Company has engaged in unfair labor practices affecting commerce within the meaning of Section 2(6) and (7) of the Act and violates Section 8(a)(1) of the Act. 4. By, on July 17, 2013, enforcing the mandatory arbitration agreement by asserting the provisions thereof in litigation brought against the Company in James Sullivan v. PJ United, Inc., and Douglas Stephens Civil Action No. 7: 13-cv LSC and by filing a motion to, in essence, compel plaintiffs to individually arbitrate their class-wide wage and hour claims against the Company, the Company has engaged in unfair labor practices affecting commerce within the meaning of Section 2(6) and (7) of the Act and has violated Section 8(a)(1) of the Act. Page 9

11 Judge Cates recommended the following Order: The Company, PJ Cheese, Birmingham, Alabama, it officers, agents, successors, and assigns, shall 1. Cease and desist from (a) Maintaining a mandatory arbitration policy, that waives employees right to maintain class or collective actions in all forums; whether arbitral or judicial. (b) Maintaining a mandatory arbitration policy that leads employees reasonably to believe that they are prohibited from filing charges with the National Labor Relations Board. (c) Seeking to enforce its mandatory arbitration policy by filings in any court to compel individual arbitration pursuant to the terms of its mandatory arbitration policy. (d) In any like or related manner, interfering with, restraining or coercing employees in the exercise of their right under the Act. 2. Take the following affirmative action designed to effectuate the policies of the Act. (a) Within 7 calendar days after the Board enters its Decision, and upon request of Charging Party James Sullivan, file a joint motion with Sullivan to vacate United States District Court Judge L. Scott Coogler s Order of September 10, 2013, granting the Company s motion to stay the trial of Sullivan s civil action in James Sullivan v. PJ United, Inc., and Douglas Stephens Civil Action No. 7: 13-cv LSC. (b) Reimburse Charging Party James Sullivan for any legal and related expenses incurred, to-date and in the future, with respect to James Sullivan v. PJ United, Inc., and Douglas Stephens Civil Action No. 7: 13-cv LSC, with interest, as described in the remedy section of this decision. (c) Rescind, modify or revise its mandatory arbitration policy to ensure its employees the mandatory arbitration policy does not contain or constitute a waiver, in all forums, of their right to maintain employment-related class or collective actions. Page 10

12 (d) Rescind, modify or revise its mandatory arbitration policy to ensure its employees the mandatory arbitration policy does not prohibit them from filing charges with the National Labor Relations Board. (e) Notify its employees of the rescinded, modified or revised mandatory arbitration policy and provide a copy of any modified or revised policy to each employee. Counsel for the Claimant, counsel for the Employer and the Arbitrator participated in pre-hearing management conferences by telephone on October 9, 2013 and August 22, During the October conference, the parties and the Arbitrator agreed to hold the arbitration in abeyance pending the outcome of the NLRB action. 4 During the August conference, the parties and the Arbitrator agreed that the parties should brief and the Arbitrator should decide whether the present action may proceed as a collective action or be limited to the Claimant s individual claims before the submission of evidence related to any specific claim. Both parties timely submitted briefs-in-chief and reply briefs. The Arbitrator received the parties reply/response briefs on September 12, The issue to be resolved at this point in time is whether the present arbitration may proceed as a collective action or will be limited to consideration of the Claimant s individual claim(s) only. 4 Contrary to the Claimant s Brief, the Arbitrator s notes do not indicate that counsel for the Employer agreed explicitly or implicitly that the Arbitrator should be bound by any decision the NLRB or an administrative law judge might issue. On the contrary, the Arbitrator s notes indicate that counsel for the Employer stated in effect that he was not agreeing that Board s decision would have any impact on the present arbitration. Page 11

13 DISCUSSION As stated above, the issue to be resolved at this point in time is whether the present arbitration may proceed as a collective action or will be limited to consideration of the Claimant s individual claim(s) only. The Arbitrator finds that the present arbitration may proceed as a collective action and therefore enters the Order set out below. The Arbitrator s reasoning follows. The present case at first appears to present a conflict between precedential decisions in the U.S. Court of Appeals for the Eleventh Circuit. 5 As Claimant points out, a line of cases holds that that an arbitrator must abide by decisions of the NLRB and may not direct a party to commit an unfair labor practice. 6,7 The Employer, on the other hand, relies on an Eleventh Circuit case that holds that an agreement to arbitrate must be enforced as written and that provisions in such agreements waiving the right to pursue a claim collectively are enforceable. 8 However, the facts of the case are such that the case cited by Employer is distinguishable. Under the circumstances, the undersigned Arbitrator must be guided by the line of cases cited by Claimant. 5 If the arbitrator were to enforce the collective action waiver in this case, one statement in the Dispute Resolution Program Booklet would be remarkably inaccurate in this regard. It tells an employee that by using arbitration, his/her rights are protected and damages can be paid if those rights have been violated. It is only the process that is different. Arbitration does protect an employee s substantive rights. However, whether legally waiveable or not, an employee s ability to participate in an FLSA collective action is a right nonetheless. Enforcing a waiver of that right does not protect it. 6 See, e.g., General Warehousemen & Helpers Local 767 v. Standard Brands, Inc., 579 F.2d 1282 (5 th Cir. 1978), cert dismissed 441 U.S. 957 (1979); New Orleans Typographical Union v. NLRB, 368 F.2d th Cir. 1966). 7 Decisions of the U.S. Court of Appeals for the Fifth Circuit handed down by that court prior to the close of business on September 30, 1981 are binding as precedent in the Eleventh Circuit; Bonner v. City of Prichard, 661 F.2d 1206 (11 th Cir. 1981). 8 See, e.g., Walthour v. Chipio Windshield Repair, LLC, 745 F.3d 1326 (11 th Cir. 2014), cert denied (June 30, 2014). Page 12

14 The Arbitration Agreements signed by Claimant and Douglas Stephens in 2008 and 2010 and the Dispute Resolution Program Booklet each provide that arbitration shall not be conducted on a collective basis. However, in an action between these same parties, NLRB Administrative Law Judge William Nelson Cates held, inter alia, that the Employer engaged in unfair labor practices affecting commerce within the meaning of Section 2(6) and (7) of the National Labor Relations Act and violated Section 8(a)(1) of the Act by maintaining its mandatory arbitration policy, which includes a waiver of the right of its employees to maintain collective actions in all forums. So far as the Arbitrator can determine from the evidence presented, that decision has not been reversed or modified. 9 Therefore, the Arbitrator must respect that decision. Indeed, unless and until it is modified, that decision is entitled to be respected as the law of this case. 10 As noted above, the Employer relies on a judicial decision that holds that an agreement to arbitrate must be enforced as written and that provisions in such agreements waiving the right to pursue a claim collectively are enforceable. The difficulty with the Employer s argument, as applied to the facts of this case, is that the 9 Both parties noted in their respective briefs that the Arbitrator does not have the power to reverse the decision of Judge Cates. 10 The Employer s suggestion that the Arbitrator should disregard Judge Cates s decision because neither PJ United nor Stephens was a party to Board s Complaint is not persuasive. Judge Cates disposed of a similar argument: First, I note PJ Cheese is a wholly-owned subsidiary of PJ United. PJ United adopted the Dispute Resolution Program for its PJ Cheese 40 employees. The Acknowledgement and Receipt for the Dispute Resolution Program that Charging Party Sullivan signed was used by the Company in its defense to the civil action brought by Sullivan against PJ United. In fact, without the Company s (PJ Cheese) active participation in the civil suit PJ United would not have had, or been able to advance, the defense it did in Charging Party Sullivan s civil suit. Stated differently, PJ United lacked any agreement with Charging Party Sullivan and in order to prevail in the civil suit, as it did, PJ United needed, and obtained, the Company here, PJ Cheese s, direct participation in its legal defense based on provisions of the Dispute Resolution Program. Page 13

15 decision cited by it did not involve a situation wherein the NLRB had determined that enforcing a waiver of collective actions of FLSA claims constituted a violation of law. Walthour involved an appeal from a district court s order granting motions of the employer; the decision makes no reference to involvement by the NLRB. Section 2 of the Federal Arbitration Act provides that a contract to arbitrate a future dispute shall be valid, irrevocable, and enforceable, save upon such grounds as exist at law or in equity for the revocation of any contract. Contract law is, of course, a matter of state law. Alabama law clearly provides that a contract to commit an illegal act should not be enforced as written but rather should be reformed. 11 Given the illegal nature of the prohibition against collective actions set out in the Arbitration Agreements signed by Claimant and Douglas Stephens in 2008 and 2010 and the Dispute Resolution Program Booklet, the Arbitrator must excise it. Thus it is proper to read those Agreements and the Booklet as authorizing an employee to pursue an FLSA claim as a collective action. 12 The Employer correctly notes that in D.R. Horton, Inc. v. N.L.R.B., 737 F.3d 344 (5 th Cir., 2013), the court refused to enforce the NLRB s decision in D. R. Horton, Inc., 357 NLRB No. 184 (2012), on which Judge Cates decision appears to be largely based. However, that Fifth Circuit decision is not precedential in the Eleventh Circuit. More importantly, while the Order set out below might have followed from a successful action to enforce Judge Cates decision (assuming the NLRB had adopted it), the Arbitrator is not enforcing Judge Cates s decision. That decision relates to the 11 See, e.g. Ex parte Celtic Life Insurance Co., 834 So.2d 766 (Ala. 2002). 12 Koullas v. Ramsey, 683 So.2d 415 (Ala. 1996), cited by the Employer, has no application where, as here, the contractual provision at issue is illegal. Page 14

16 enforceability of the Employer s mandatory arbitration agreement generally. The Arbitrator is merely respecting that decision as it applies to the facts of the present case. The Employer s argument that the arbitrator selection provisions of the Arbitration Agreements signed by Claimant and Douglas Stephens in 2008 and 2010 and the Dispute Resolution Program Booklet prohibit the Claimant s pursuing a collective action is not persuasive. As Claimant notes in his Response Brief, the collective action process of the FLSA provides for an opt-in procedure. Thus, no employee will be bound unless he/she opts into the present arbitration. In addition, to allow the Employer to avoid Claimant s pursuing his FLSA claim as a collective action on the basis of the arbitrator selection provisions would allow the Employer to accomplish indirectly that which Judge Cates decision prohibits directly, i.e. enforcing a waiver of collective actions. The Employer s argument that requiring the Claimant to proceed individually will hurt no one is not persuasive. It ignores completely the rationale underlying collective actions, i.e. amassing a claim large enough to warrant prosecution. As anyone familiar with judicial and arbitral processes in this country is well aware, there is no substitute for quality representation and quality representation is not free. For the above reasons, the Arbitrator will order that Claimant may continue this arbitration as a collective action. Page 15

17 ORDER Having heard or read and carefully reviewed the evidence and argumentative materials in this case and in light of the above Discussion, the Arbitrator directs that Claimant may continue the present arbitration as a collective action. Dated: December 12, 2014 Jack Clarke, Arbitrator Athens, Georgia Page 16