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Class Actions Waived? Workers File Hundreds of Solo Arbitrations

Bloomberg BNA Daily Labor Report – Jon Steingart

Buffalo Wild Wings faces hundreds of arbitration proceedings filed by employees it said were ineligible to join a courtroom class action claiming the sports bar chain paid tipped workers less than they were owed.

About 5,500 workers joined the class action against Buffalo Wild Wings, out of 62,000 who received notices. The two sides determined that 822 of those seeking to join the action couldn't proceed in court because they had signed arbitration agreements that include a class action waiver prohibiting the workers from bringing or joining in class actions against the company. Nearly 400 workers then opted to file individual arbitration claims under the terms of the arbitration agreements.

"We will file hundreds of individual cases if that's what's necessary," Justin Swartz, an attorney for the workers, told Bloomberg Law in an email Oct. 30. "We won't let companies insulate themselves from liability by taking away workers right to go to court."

An employer may pay tipped employees, such as waiters and bartenders, an hourly wage lower than the general minimum as long as it complies with certain requirements. There are guidelines governing the amount of time a worker can spend on tasks that result in tips, like serving customers, and those that don't, such as setting up before a shift, and still be paid the tipped minimum wage.

Worker Identities Undisclosed

The workers' attorneys didn't disclose the identities of the waiters and bartenders who filed 391 individual arbitrations Oct. 25 but provided a redacted complaint they said is representative of the claims. They also said the workers who filed the arbitrations were among those who filed paperwork to join the court class action.

The U.S. Supreme Court is weighing whether employers can bar workers from joining together to pursue workplace-related claims in court or in arbitration. Federal appeals courts are divided on how to resolve the tension between two federal laws: the National Labor Relations Act, which grants employees the right to engage in "concerted activity," and the Federal Arbitration Act, which articulates a "national policy favoring arbitration."

Buffalo Wild Wings didn't immediately respond to a request for comment.

Justin Swartz, Molly Brooks, and Juno Turner with Outten & Golden LLP in New York; Sally Abrahamson and Pamela Disney with Outten & Golden in Washington; and Douglas Werman and Zachary Flowerree with Werman Salas P.C. in Chicago represent the workers in the individual arbitrations.

To contact the reporter on this story: Jon Steingart in Washington at @email

To contact the editor responsible for this story: Terence Hyland at @email

Reproduced with permission from Class Action Litigation Report, 18 CLASS 1021, 11/10/17. Copyright 2017 by The Bureau of National Affairs, Inc. (800-372-1033) http://www.bna.com