The Trump administration is poised to side with employers in a Supreme Court case over the rights of workers to bring class action lawsuits against companies, according to a court document and a source familiar with the litigation.
Signaling the reversal of a position staked out earlier by the Obama administration, which backed employees, the National Labor Relations Board (NLRB), an independent agency in the federal government, said in letter to the court on Thursday that its own lawyer will represent the board in the employees’ class action rights case.
It will take over from the Justice Department, which had previously handled the case.
It is unusual for the government to change positions in a case already pending at the Supreme Court, and a source familiar with the litigation said the change of lawyers indicated the department was likely to file court papers in support of the employers.
That would mark a sharp break from the administration of former President Barack Obama, a Democrat, which had originally pursued the case on behalf of the NLRB.
The legal dispute is over whether employment agreements requiring workers to waive their rights to bring class action claims are invalid, as the labor board has found.
The NLRB currently has a Democratic majority, isolating it politically from the Republican Trump administration.
In January the Supreme Court agreed to review three lower court rulings, including one involving global professional services firm Ernst & Young, over the legality of the waivers. Employers have increasingly compelled workers to sign them as part of their arbitration agreements to guard against the rising tide of worker lawsuits seeking unpaid wages.
Companies say the waivers allow for speedier and more cost-effective resolution of workplace disputes. Class action litigation, on the other hand, is harder to fight and can lead to large damages awards.
Workers argue that pursuing their cases individually is prohibitively expensive and, without the prospect of large damages awards that class action litigation can lead to, lawyers will be deterred from taking their cases.
The nine Supreme Court justices are expected to issue a ruling on the issue in the court’s next term, which starts in October and ends in June 2018.
(Reporting by Alison Frankel, Robert Iafolla, Andrew Chung and Lawrence Hurley; Editing by Tom Brown)