Careful drafting of confidentiality duty clause within employment arbitration context


lcmm@melchionnalaw.com
Careful drafting of confidentiality duty...

Are employees allowed to discuss arbitral proceedings, its merit and documents disclosure with third parties if they signed an exclusive arbitration agreement? In Pfizer, Inc., (Case 10-CA-175850) an administrative law judge of the National Labor Relation Board (NLRB) ruled that a confidentiality obligation within the employment arbitration clause is prohibited under the National Labor Relations Act (NLRA). Pfizer did not apply Epic System Corp. v. Lewis (584 U.S. ___ (2018)) and/or AT&T Mobility LLC v. Conception (563 U.S. 333 (2011)) stating that both cases did not control. In Epic the US Supreme Court confirmed the validity of an arbitration clause that bars employees under collective contracts from filing a class action.

The ALJ argument rests on the distinction between procedural and substantive right analysis: Epic allowed employees to be limited by a mere procedural right (as a class); on the contrary, it seems that Employees cannot be limited in their substantive right to discuss their cases with third parties. More litigation is underway shaping the final judicial determination.

Pending this litigation, employers are encouraged to carefully review their arbitration clauses and its confidentiality statements.