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NLRB Judge Rules Against SolarCity's Arbitration Agreement

On Friday, September 8, 2017, National Labor Relations Board ("NLRB" or the "Board") Administrative Law Judge Eleanor Laws ruled that SolarCity Corp. ("SolarCity") maintained arbitration agreements with its employees which were illegal due to the fact that they could be read by workers as restricting their rights to file unfair labor practice charges with the NLRB.

The Board found that a reasonable employee would read the agreement as requiring all employment disputes to be settled through arbitration, therefore violating the National Labor Relations Act. Judge Laws focused on the language of the agreement-specifically, the phrase "without limitation" which was used to describe which disputes would, under the agreement, be subject to arbitration. The Judge found that there was no reason to include the qualifier if not to confuse the reader.

The arbitration agreements at issue were imposed as a condition of employment on all employees of SolarCity.

Judge Laws told SolarCity to rescind the mandatory arbitration program at issue or revise it to make it clear to workers that the agreement does not bar or restrict employees' right to file charges with the NLRB.

The legal team at SFMS has significant experience litigating securities matters. If you have any questions regarding this subject or this posting, please contact Nick Lussier (nlussier@sfmslaw.com) or Chiharu Sekino (csekino@sfmslaw.com). We can also be reached toll-free at (866) 540-5505.

Shepherd, Finkelman, Miller & Shah, LLP is a law firm with offices in California, Connecticut, Florida, New Jersey, New York, and Pennsylvania. SFMS is an active member of Integrated Advisory Group (www.iaginternational.org), which provides us with the ability to provide our clients with access to excellent legal and accounting resources throughout the globe. For more information about our firm, please visit us at www.sfmslaw.com.

Sources

Lidgett, Adam. "NLRB Judge Finds Fault With SolarCity Arbitration Pacts." Law 360. Last modified on September 11, 2017.

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