Blog

Federal appeals court allows arbitration for FLSA claims

A decision from the U.S. Court of Appeals for the 2nd Circuit, which includes New York, has affirmed the legality of employer-imposed arbitration requirements for claims involving the Fair Labor Standards Act. Although a previous ruling from the 2nd Circuit had required court supervision of settlements reached through arbitration, the panel of judges did not view this requirement as a ban on arbitration. The judges did not link judicial review of settlements with a prohibition on alternative dispute resolution methods.

The case before the appeals court had drawn upon the previous decision regarding court supervision of arbitrated settlements. The court rejected the argument of the plaintiff because the goal of supervision was to promote fairness within a settlement claim and not dictate the forum for reaching the settlement agreement.

Despite the 2nd Circuit’s allowances for arbitration, opinions have been inconsistent among other circuits. The lack of clarity has sent the issue to the Supreme Court of the United States. The highest court is currently considering whether employers can enforce provisions in arbitration agreements that prevent FLSA claims from becoming class action cases. Unless the Supreme Court decides otherwise, employers in New York could expect to apply arbitration agreements to FLSA claims.

The FLSA includes wage and hour laws that often form the basis of disputes between employers and workers. An owner or executive of a company confronted by an FLSA claim could consult an attorney about how to respond. To protect the employer from liability, an attorney could document the reasons behind an employer’s decision about the classification of a position or rate of pay. With legal representation, an employer could obtain specific legal advice when negotiating the terms of a settlement or denying allegations about unpaid overtime or paying below minimum wage.

Schedule an initial consultation with us

  • Get the Support of an Experienced Employment Law Attorney Today

star star star star star

Personal Approach

“The firm's attorney have earned solid reputations, not only as strategic problem solvers, successful dealmakers and talented litigators, but also as compassionate and empathetic counselors.”

John Smith
ABC Company
star star star star star

Awesome Lawyer

“Having the right content on your website is vitally important to your Google ranking as well as for the branding of your company. We prefer to put a title to each text area and place special code on it so Google recognizes what the page and site are about.”

Catherine Jo
xyz Company
star star star star star

The Best Lawyer I have ever met

“The firm's attorney have earned solid reputations, not only as strategic problem solvers, successful dealmakers and talented litigators, but also as compassionate and empathetic counselors.”

Steven White
lmn Company

Is Your Business Safe From Baseless Claims? You can never be too safe, especially as a business owner. Get the support of an experienced employment law attorney today. Schedule an initial consultation with us via email or by calling 212-257-3391.

Egan Law Firm, LLC
805 Third Avenue
10th Floor
New York, NY 10022-7513

Phone: 212-257-3391

Fax: 646-417-7977

Call Us Today

212-257-3391