Arbitration agreements are intended to expedite the legal process while minimizing fees and costs. In reality, former employees and their counsel often resist submitting their employment claims to arbitration, resulting in protracted and expensive litigation before trial and appellate courts on the issue of whether there is an enforceable arbitration agreement. This year, the Supreme Court of Texas issued two key decisions that may provide employers with stronger legal grounds for enforcing their arbitration agreements.
On January 12, 2021, the Fifth Circuit Court of Appeals issued a landmark decision rewriting the rules for obtaining certification in collective actions under the Fair Labor Standards Act (FLSA).
The U.S. Court of Appeals for the Fifth Circuit, which covers Texas, Louisiana, and Mississippi, recently found that punitive and compensatory damages are not available for retaliation claims brought under the federal Age Discrimination in Employment Act of 1967 (ADEA). The ADEA already provides for liquidated damages equal to the amount of lost pay and benefits for “willful” age discrimination. The standard for finding a willful violation to award liquidated damages is quite low, resulting in the routine award of what is, in effect, double damages in ADEA cases.