The U.S. Supreme Court on Monday handed a small, but potentially significant, victory to a fast-food worker from Iowa.
The court did not address the basic premise of Robyn Morgan’s lawsuit – that the Taco Bell restaurant she worked for had violated wage-and-hour laws. The court did, however, address a procedural issue that could have major implications for U.S. workers whose employers insist on arbitration to settle disputes that would otherwise be heard in court.
Beginning sometime around 2015, Morgan worked as an hourly employee for a Taco Bell restaurant in Osceola, which was owned by a franchise called Sundance. When applying for the job, Morgan signed an agreement to arbitrate any employment dispute.
In 2018, she filed a nationwide collective action case — a procedure for litigating a multi-plaintiff wage dispute, similar in nature to a class-action lawsuit — against Sundance. She alleged the company violated federal laws regarding overtime by moving some workers’ hours into other pay periods as a way of preventing the employees from being paid for more than 40 hours in any given week.
Sundance initially defended its actions in court, as if no arbitration agreement was in place. But after eight months of litigation, Sundance filed a motion to compel arbitration in the matter.
Morgan’s attorneys opposed the motion, arguing that Sundance had waived its right to arbitrate by litigating for so long. A district court judge agreed and denied Sundance’s motion. The company...
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