Class Action Grievances In Minnesota
Class action grievances permit a group of individuals who are similarly situated to arbitrate claims together under one umbrella case. Previously, if a labor contract or arbitration agreement was silent on class action grievances, they were generally allowed by most arbitrators. However, according to the U.S. Supreme Court that is no longer the case.
In April, the U.S. Supreme Court ruled “[A] party may not be compelled under the FAA (Federal Arbitration Act) to submit to class arbitration unless there is a contractual basis for concluding that the party agreed to do so.” Stolt-Nielsen v. Animal Feeds Intl’ Corp. This means unless an arbitration agreement specifically permits class action arbitrations, none will be allowed.
But wait, in May the Minnesota legislature passed legislation overhauling the Minnesota Uniform Arbitration Act. In the overhaul there is a provision for consolidating separate arbitration proceedings if some or all of the claims are between the same parties, the claims arise in substantial part from the same transaction or series of related transactions, there is a common issue of law which creates the possibility of conflicting decisions, and the prejudice for failing to consolidate claims is not outweighed by the risk of delay or prejudice to the party opposing consolidation. In essence, the law provides a vehicle to combine grievances, much like a class action grievance.
What the U.S. Supreme Court had put asunder, the Minnesota legislature now has put together….
