Overcoming an Arbitration Clause in Your Employment Contract and Litigating Your Overtime

Overcoming an Arbitration Clause in Your Employment Contract and Litigating Your Overtime As a worker, you have certain rights if you think that your employer has paid you a sub-minimum wage or has failed to pay you the overtime compensation that you're owed. At the federal level, many of these rights are advanced under the Fair Labor Standards Act. With a skilled San Mateo wage-and-hour lawyer on your side, you may be able to pursue a case under these laws and perhaps recover substantial compensation. Employers, of course, know this, too, and have developed tools and techniques to try to tip the scales in their favor. One of these is to include, within new employees' employment contracts, what's called a mandatory arbitration clause. That provision says that the employee agrees that if a certain type of dispute arises (such as a breach of contract dispute or a wage-and-hour dispute,) the sides will resolve the dispute in an arbitration proceeding instead of in civil court. (The underlying idea is that, in the minds of the employers, arbitration makes for a more favorable venue for them than a state or federal trial court does.) As employers are often correct about arbitration frequently being less favorable to workers than civil courts, it may be incumbent on you, as a worker who was denied a minimum wage or proper overtime pay, to defeat an arbitration clause so that your case can go forward in court. Reach out to a employment law lawyer to assist you in your claim.

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The worker, L.S., worked for a major airline as a supervisor of ramp agents. Ramp agents are airline workers who handle the tasks of physically loading and unloading passenger baggage, airmail, and freight. L.S.'s employment contract said that, if she encountered a wage dispute, she agreed to arbitrate that disagreement individually. However, after L.S. discovered that her employer allegedly was failing to pay her and other ramp supervisors proper overtime, she launched a class action lawsuit under the FLSA. An Exception for Workers Engaged in 'Interstate Commerce'

The airline sought to invoke the arbitration clause and move the case out of federal court. The ramp supervisor, though, was prepared to fight back. She pointed out that Section 1 of the Federal Arbitration Act created an exception for "seamen, railroad employees, or any other class of workers engaged in foreign or interstate commerce." L.S.'s argument was that the nature of her work was such that she qualified under the last of these exception categories. Both the federal appeals court that heard L.S.'s appeal, along with the U.S. Supreme Court, agreed with her assertion. The courts concluded that L.S.'s work made her a transportation worker who was involved in interstate commerce. The Supreme Court explained that ramp agents and their supervisors were, "as a practical matter, part of the interstate transportation of goods" and “intimately involved with the commerce," when they loaded and unloaded items traveling in interstate commerce. That meant that the exception within Section 1 of the FAA applied, and the employee was not required to arbitrate her dispute, but instead pursue her case in her preferred location -- federal court. Recently, the U.S. Supreme Court issued a ruling that is a boost for workers across the country in pursuing their wage-and-hour claims. If you've been denied the overtime compensation you deserve and you (alongside your attorneys) have decided that proceeding in court is the best way to go, the last thing you want is to have that case derailed and diverted to arbitration. Pursuing your case in court instead of arbitration may be essential to success. Count on the experienced San Mateo wage and hour attorneys at Galine, Frye, Fitting & Frangos, LLP to be the powerful and diligent advocates you need before, during, and after your trial in court. Whether during pretrial discovery, motions to compel arbitration, or other procedural battles, count our experience to get you the outcome you deserve. Contact us at 650-345-8484 or through our website.

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