The Supreme Court of the United States ruled on May 21, 2018 that employers were permitted, as a condition of employment, to require an employee to sign an agreement to individually arbitrate Fair Labor Standards Act (FLSA) claims for unpaid wages or overtime, and to waive his/her right to participate in a class action litigation for those claims. This ruling removes an employee’s right to collectively join together in a class action for mutual protection against illegal wage practices and shifts the balance of power back to employers. As most FLSA claims involve a relatively small amount of unpaid wages for each individual employee, they are typically brought as class actions, as it is far less likely that a single employee will expend the time and expense involved in arbitration – which is the only option given the Court’s decision. The impact of this ruling is immediate and widespread, affecting as many as 25 million workers. Justice Ruth Bader Ginsberg wrote a lengthy dissent.

The full opinion can be read here.

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