On Monday, May 21, 2018, the Supreme Court of the United States sealed the fate of many low income hourly employees by ruling that companies can require employees to preemptively sign away their rights to bring class action claims against their employers. The decision in Epic Systems v. Lewis will make it particularly difficult for employees to band together as victims of wage theft, effectively precluding many of those employees from meaningful recovery. SCOTUS Green-Lights Class Action Waivers.
The decision has already had a dramatic impact on pending class action litigation. Within a matter of days of the ruling, Chipotle moved to knock approximately 3,000 employees out of an approximate 10,000 employee wage and hour class action currently pending against the fast food conglomerate. Chipotle claims that the 3,000 employees in question have preemptively waived their rights to bring class action claims against the company because those employees signed class action waivers before they began working. In that case, Chipotle has been accused of systemically forcing hourly workers to work off the clock and uncompensated. Chipotle Wage and Hour Violations.
If Chipotle is successful in moving the Court to follow the Epic decision, the 3,000 employees in question will be forced to individually pursue claims in arbitration. Arbitration is a less than ideal forum for the adjudication of wage and hour claims where an individual claim in controversy can be quite small. Prohibitive cost coupled with the inability to find an attorney willing to dedicate the time and attention to each of these claims will likely mean that many employees will suffer illegal wage loss for which there is no meaningful recovery. Companies, like Chipotle, will in turn benefit from free labor and lack of consequence.