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Logisticare Solutions, Inc. v. National Labor Relations Board

United States Court of Appeals, Fifth Circuit

August 9, 2017

LOGISTICARE SOLUTIONS, INCORPORATED, Petitioner Cross-Respondent,
v.
NATIONAL LABOR RELATIONS BOARD, Respondent Cross-Petitioner.

         On Petition for Review and Cross-Application for Enforcement of an Order of the National Labor Relations Board

          Before HIGGINBOTHAM, ELROD, and HIGGINSON, Circuit Judges.

          JENNIFER WALKER ELROD, Circuit Judge.

         LogistiCare Solutions, Incorporated, requires its employees and applicants for employment to sign a class or collective action waiver by which the employee or applicant waives any right to be a representative for, or member of, a class or collective action lawsuit against LogistiCare. An Administrative Law Judge and a three-member panel of the National Labor Relations Board concluded that the waiver violates Section 8(a)(1) of the National Labor Relations Act. Because we conclude, under our binding precedent, that the waiver does not violate Section 8(a)(1) explicitly, and because we conclude that the waiver cannot otherwise be reasonably understood to violate the Act, we GRANT LogistiCare's petition for review and DENY the Board's cross-petition for enforcement.

         I.

         LogistiCare requires its employees and applicants for employment to sign a "Class Action and Collective Action Waiver" in order to be eligible for employment. The waiver provides:

         Class Action and Collective Action Waiver

Class and Collective action lawsuits have been abused recently by trial lawyers forcing American Companies to pay large settlements, not because the cases have merit or because the Company violated any laws, but because the suits are too expensive to litigate and the company is left with no reasonable alternative. Class and Collective action suits primarily benefit the trial lawyers and rarely accomplish any other objective. There are more effective ways to protect your individual employment related rights than through a Class or Collective action law suit. Your signature on this document indicates that you agree to waive any right you may have to be a member of a Class or Collective action lawsuit or a representative of a Class or Collective action lawsuit against the Company.
I hereby acknowledge and understand that as a condition of my employment: [1] I am waiving my right to have a trial by jury to resolve any lawsuit related to my application or employment with the Company; [2] I am waiving my right to participate as a member of a Class or Collective action lawsuit and/or serve as a class representative of similarly situated employees in any lawsuit against the company.[1]

         One applicant who signed the waiver brought an unfair-labor-practice charge with the National Labor Relations Board. The Board in turn brought a complaint alleging that LogistiCare violated Section 8(a)(1) of the National Labor Relations Act, 29 U.S.C. § 158(a)(1) (NLRA or Act), by requiring employees and applicants to sign the waiver. In particular, the Board alleged that: (1) the waiver's prohibition on engaging in class or collective litigation violates Section 8(a)(1) of the NLRA by infringing rights protected by Section 7 of the Act; and (2) the waiver independently violates Section 8(a)(1) because employees would reasonably interpret the waiver to restrict their right to file charges with the Board.

         The dispute was first heard by an Administrative Law Judge, who accepted both of the Board's grounds for finding a Section 8(a)(1) violation. In a two-to-one decision, a three-member panel of the Board affirmed the ALJ's order. The Board first concluded that Section 7 of the Act guarantees employees the right to participate in class or collective actions. In so doing, it distinguished our decisions in D.R. Horton, Inc. v. NLRB, 737 F.3d 344 (5th Cir. 2013) and Murphy Oil USA, Inc. v. NLRB, 808 F.3d 1013 (5th Cir. 2015) because the waivers in those cases were contained within arbitration agreements, which are governed by the Federal Arbitration Act, 9 U.S.C. § 1, et seq. Rather than relying on these cases, the Board looked to its own decision in Convergys Corporation, et al., 363 NLRB No. 51 (2015).[2] The Board next concluded that the waiver is "independently unlawful" because "employees would reasonably read the rule as restricting their right to file unfair labor practice charges with the Board." Member Miscimarra dissented on both issues.

         Having found two Section 8(a)(1) violations, the Board ordered LogistiCare to cease and desist from the unlawful conduct and to take steps to notify all applicants and current employees that the waiver was no longer enforceable. LogistiCare petitioned for review of the Board's order and the Board cross-petitioned for enforcement.[3]

         II.

         We review the Board's factual findings under a substantial evidence standard. Flex Frac Logistics, L.L.C. v. NLRB, 746 F.3d 205, 207 (5th Cir. 2014) (quoting Sara Lee Bakery Grp., Inc. v. NLRB, 514 F.3d 422, 428 (5th Cir. 2008)). Substantial evidence is such relevant evidence "sufficient for a reasonable mind to accept as adequate to support [the] conclusion"; it is "more than a mere scintilla and less than a preponderance." Id. (alteration omitted). While we review the Board's legal conclusions de novo, we will "enforce the Board's order if its construction of the statute ...


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