Late last year, the Second Circuit Court of Appeals, the federal appeals court that covers New York, Connecticut, and Vermont, held Fair Labor Standards Act claims (i.e. wage and hour claims) can be subject to arbitration.
In Rodriguez-Depena v. Parts Authority, Inc., the issue before the Court was whether claims under the Fair Labor Standards Act are subject to arbitration. The plaintiff, Rodriguez-Depena, signed an employment contract containing a clause requiring arbitration of any dispute arising out of the contract. The plaintiff then brought an FLSA claim for alleged unpaid overtime. The defendant filed a motion to dismiss based on the arbitration provision. The district court ordered arbitration and dismissed the complaint. The plaintiff appealed.
Relying, in part, on Supreme Court precedent which upheld the enforcement of a contractually required arbitration for an Age Discrimination In Employment Act claim (i.e. another federal statutory claim), it found FLSA claims are arbitrable. For employers, this can serve as good news as arbitration allows employers to avoid lengthy and costly court litigation.
Brody and Associates regularly advises management on complying with state and federal wage and hour laws and employment laws generally. If we can be of assistance in this area, please contact us at info@brodyandassociates.com or 203.454.0560.
