National Labor Relations Board Rules that Mandatory Arbitration Clause Violates The National Labor Relations Act
This memorandum addresses the recent U-Haul Company of California decision by the National Labor Relations Board. The decision potentially affects all companies that use mandatory arbitration agreements. In its ruling of first impression, the NLRB held that an employer violated the National Labor Relations Act by instituting a mandatory arbitration policy with broad language that could reasonably be read by employees to prohibit the filing of unfair labor practice charges with the Board. This memorandum examines the Board’s decision and discusses what steps employers might consider in light of the ruling.