VALERIE CAPRONI, District Judge:
Plaintiff brings this putative collective and class action against her former employer for alleged violations of the Fair Labor Standards Act ("FLSA") and the New York Labor Law ("NYLL"). Defendant
Defendant is a furniture retailer that operates stores in multiple states, including New York. Compl. ¶ 2; McPeak Decl. ¶ 4. Plaintiff worked as a Sales Associate from June 20, 2005, to February 2, 2014, the date on which she was terminated. Compl. ¶ 17; McPeak Decl. ¶¶ 5, 11, Ex. 1. Plaintiff claims that Defendant misclassified all of its Sales Associates as exempt from the overtime provisions of the FLSA and NYLL. Compl. ¶ 5. As a result, Defendant failed to pay them overtime wages for all the hours worked in excess of forty hours per week in violation of both statutes. Id. ¶¶ 78, 87.
When Plaintiff was hired, Defendant provided her with a copy of its Associate Handbook ("Handbook"). McPeak Decl. ¶ 5. Plaintiff signed an acknowledgment form stating that she understood the Handbook's contents to be "applicable to the position" for which she had been hired. McPeak Decl. Ex. 1. The form stated that the Handbook's contents were "not promissory or contractual in nature" and that Plaintiff's employment was "not for any stated period." Id. In October 2009, Defendant updated its Handbook and distributed copies to all employees. McPeak Decl. ¶ 6. Plaintiff acknowledged that her continued employment would constitute her agreement to the 2009 changes and all future changes made to the Handbook. McPeak Decl. Ex. 2. The 2009 acknowledgment form stated that "nothing in the Handbook constitutes a contract or promise of continued employment," that Plaintiff's employment was "at will" and that the parties had not "entered into an employment agreement for a specified period of time." Id.
In February 2012, Defendant issued a revised version of its Handbook, which, for the first time, included the Employment Arbitration Program ("EAP"). McPeak Decl. ¶ 12, Ex. 6. Defendant notified its employees by email and required them to acknowledge that they had reviewed the updated Handbook. McPeak Decl. ¶ 13, Exs. 7, 8. Plaintiff did so. McPeak Decl. Ex. 9. Defendant amended its Handbook one more time in April 2013 and again emailed its employees and required them to acknowledge the updates. McPeak Decl. ¶ 18, Ex. 11. Plaintiff electronically acknowledged her review of the Handbook. McPeak Decl. Ex. 12.
Page five of the 2013 version of the Handbook declares:
The Handbook describes the EAP as
Id. at 66 (emphasis in original).
Defendant moves to compel arbitration based on the company's EAP.
In deciding a motion to compel arbitration under the Federal Arbitration Act ("FAA"), 29 U.S.C. §§ 3 and 4, the Court "applies a standard similar to that applicable for a motion for summary judgment." Bensadoun v. Jobe-Riat, 316 F.3d 171, 175 (2d Cir.2003) (citations omitted). A motion to compel arbitration may be granted "when the pleadings, the discovery and disclosure materials on file, and any affidavits show that there is no genuine issue as to any material fact and that movant is entitled to judgment as a matter of law." Thomas v. Pub. Storage, Inc., 957 F.Supp.2d 496, 499 (S.D.N.Y. 2013) (citations and internal quotation marks omitted). "All facts, inferences, and ambiguities must be viewed in a light most favorable to the nonmovant." Alexander & Alexander Servs., Inc. v. These Certain Underwriters at Lloyd's, London, 136 F.3d 82, 86 (2d Cir.1998) (citing Matsushita Elec. Indus. Co. v. Zenith Radio Corp., 475 U.S. 574, 587, 106 S.Ct. 1348, 89 L.Ed.2d 538 (1986)). If the Court determines "that an arbitration agreement is valid and the claim before it is arbitrable, it must stay or dismiss further judicial proceedings and order the parties to arbitrate." Nunez v. Citibank, N.A., No. 08-CV-5398 (BSJ), 2009 WL 256107, *2 (S.D.N.Y. Feb. 3, 2009) (citations omitted).
The FAA was designed to "ensure judicial enforcement of privately made agreements to arbitrate." Dean Witter Reynolds, Inc. v. Byrd, 470 U.S. 213, 219, 105 S.Ct. 1238, 84 L.Ed.2d 158 (1985). Under the FAA, a written agreement to arbitrate "shall be valid, irrevocable, and enforceable, save upon such grounds as exist at law or in equity for the revocation of any contract." 9 U.S.C. § 2. This section manifests "a liberal federal policy favoring arbitration agreements." Moses H. Cone Mem. Hosp. v. Mercury Constr. Corp., 460 U.S. 1, 24, 103 S.Ct. 927, 74 L.Ed.2d 765 (1983). To decide a motion to compel arbitration, the Court must: (1) determine whether the parties agreed to arbitrate; (2) determine the scope of the parties' agreement; (3) if federal statutory claims are asserted, consider whether Congress intended those claims to be nonarbitrable; and (4) if some, but not all, of the claims in the case are arbitrable, determine whether to stay the balance of the proceedings pending arbitration. Genesco, Inc. v. T. Kakiuchi & Co., 815 F.2d 840, 844 (2d Cir.1987).
Plaintiff asserts that there is no arbitration agreement between her and Defendant. The Court disagrees.
Under New York law, a party who signs a written contract is conclusively presumed to know its contents and to assent to them, and he is therefore bound by its terms and conditions. Level Exp. Corp. v. Wolz, Aiken & Co., 305 N.Y. 82, 87, 111 N.E.2d 218 (1953). With regards to arbitration agreements in the employment context, "[c]ourts in this district routinely uphold arbitration agreements contained in employee handbooks where . . . the employee has signed an acknowledgment form." Chanchani v. Salomon/Smith Barney, Inc., No. 99-CV-9219 (RCC), 2001 WL 204214, *3 (S.D.N.Y. Mar. 1, 2001); see also Litvinov v. UnitedHealth Grp. Inc., No. 13-CV-8541 (KBF), 2014 WL 1054394, *3 (S.D.N.Y. Mar. 10, 2014) (the parties agreed to arbitrate; the employee "electronically acknowledged that she received and reviewed the Arbitration Policy" of her employer.); Beletsis v. Credit Suisse First Boston, Corp., No. 01-CV-6266 (RCC), 2002 WL 2031610, *3 (S.D.N.Y. Sep. 4, 2002) (the parties agreed to arbitrate; the employee "signed the Compliance Certification" that referred to the employer's arbitration program); Arakawa v. Japan Network Grp., 56 F.Supp.2d 349, 352 (S.D.N.Y.1999) ("[T]he parties' agreement to arbitrate is evidenced by the Employee Handbook and the Acknowledgment signed by plaintiff.").
In this case, there is an agreement to arbitrate because the Plaintiff acknowledged that she had read and reviewed the 2013 version of Defendant's Handbook, containing the EAP. McPeak Decl. Ex. 12. The 2013 Handbook expressly provided that "[a]s an associate, [Plaintiff was] responsible for abiding by Raymour & Flanigan's rules, policies and practices." McPeak Decl. Ex. 10 at 5. Under these circumstances, it is clear that Plaintiff agreed to be bound by the EAP.
Moreover, the FAA does not require a signed writing, but only a writing, 9 U.S.C. §§ 2, 3 and 4, and, "[u]nder New York law, the conduct of the parties may lead to the inference of a binding agreement." Beth Israel Med. Ctr. v. Horizon Blue Cross & Blue Shield of N.J., Inc., 448 F.3d 573, 582 (2d Cir.2006) (citing Jemzura v. Jemzura, 36 N.Y.2d 496, 503-504, 369 N.Y.S.2d 400, 330 N.E.2d 414 (1975)). It is well-settled that revisions to an employee handbook are binding when the employee continues to work after receiving notice of the revisions. See Manigault v. Macy's E., LLC, 318 Fed.Appx. 6, 8 (2d Cir.2009) ("An employee may consent to a modification to the terms of employment by continuing to work after receiving notice of the modification.") (citations omitted); see also Brown v. St. Paul Travelers Co., 331 Fed.Appx. 68, 70 (2d Cir.2009) (holding that the employee's "continued employment after" repeated notifications regarding the employer's arbitration policy "lends force to the presumption that she agreed to be bound to the arbitration policy.").
By continuing to work after receiving notice of the EAP, Plaintiff agreed to the terms of the arbitration program. When Defendant released the 2013 Handbook, Plaintiff received an email from the Vice President of Human Resources informing
Plaintiff argues that Manigault and Brown, the cases relied on by Defendant, are distinguishable because the arbitration provisions at issue in those cases were much more prominently presented to the employees and were not included in an employee handbook. But Manigault and Brown did not turn on a particular degree of notice or the format in which it was given. For contract formation purposes, these cases simply require continued employment after notice of the handbook's terms, without specifying any particular form of required notice. In this case, there is no dispute that Plaintiff continued to work for Defendant after receiving notice of the Handbook's 2012 and 2013 revisions, including the addition of the EAP in 2012.
In any event, Plaintiff did not receive less notice than the plaintiffs in the cited cases. In Manigault, 318 Fed.Appx. at 8, the employee received information regarding the employer's arbitration program by mail and in Brown, 331 Fed.Appx. at 70, the employee received a copy of a revised handbook and an email from her employer directing her to read all company policies and stating that such policies were an express condition of continued employment. In this case, Defendant specifically highlighted the EAP when it announced the 2012 Handbook revisions, referred employees to the page at which the program could be found, and briefly described the program as implementing a "consistent and efficient way for our associates and the company to resolve employment disputes." McPeak Decl. Ex. 7. Such notice is sufficient.
Plaintiff's chief argument in support of her position that there is no agreement to arbitrate is that the disclaimers at the beginning of the Handbook prevent the formation of an agreement to arbitrate. In support, Plaintiff relies on a group of cases that hold that an employee handbook with language that negates the creation of contractual rights or obligations cannot be the basis of a breach of contract claim brought by an employee against his or her employer. See Maas v. Cornell Univ., 94 N.Y.2d 87, 699 N.Y.S.2d 716, 721 N.E.2d 966 (1999); Dellefave v. Access Temp., Inc., 37 Fed.Appx. 23 (2d Cir.2002); Baron v. Port Auth. of N.Y. & N.J., 271 F.3d 81 (2d Cir.2001); Jain v. McGraw-Hill Co., 827 F.Supp.2d 272 (S.D.N.Y.2011); Sharkey v. J.P. Morgan Chase & Co., No. 10-CV-3824, 2011 WL 135026 (S.D.N.Y. Jan. 14, 2011).
Plaintiff's argument fails for two reasons. First, none of the cases cited by Plaintiff considered the enforceability of an arbitration agreement included in an employee handbook.
Isaacs v. OCE Bus. Serv., Inc., 968 F.Supp.2d 564, 571 (S.D.N.Y.2013) (citing
Second, even if the Court were to conclude that the language of the EAP is not sufficiently distinctive, the disclaimers at the beginning of the Handbook do not prevent contract formation with respect to the EAP. The disclaimers in Defendant's Handbook are different from those in the cases relied on by Plaintiff because, instead of negating the creation of contractual obligations in general, they do so only "on the part of the Company." McPeak Decl. Ex. 10 at 5 (emphasis omitted). Although the Handbook does not impose contractual obligations on Defendant, the arbitration provisions are nonetheless binding on Plaintiff.
Finally, Plaintiff asks the Court to follow a New Jersey District Court decision holding that Defendant's Handbook does not contain a binding arbitration agreement. See Raymours Furniture Co., Inc. v. Rossi, No. 13-CV-4440 (JBS), 2014 WL 36609, *6 (D.N.J. Jan. 2, 2014). Rossi is premised partly on New Jersey law that is inconsistent with New York law. In New Jersey, continued employment after receipt of an employee handbook does not constitute acceptance of its terms. See id. That rule of law is entirely at odds with New York law as interpreted in Manigault and Brown and, therefore, Rossi is not even persuasive precedent for this case.
The remaining Genesco factors further weigh in favor of arbitration. With respect to the second factor, it is undisputed that Plaintiff's claims under the FLSA and NYLL fall within the EAP's scope. Defendant's EAP covers "any employment-related or compensation-related claims . . . that in any way arise from or relate to your employment with us . . . and that are based upon a legally protected right," including rights under the "the federal Fair Labor Standards Act or any state wage and hour laws." McPeak Decl. Ex. 10 at 59 (emphasis omitted). As for the third factor, there is no indication that Congress intended Plaintiff's FLSA claims to be nonarbitrable. See, e.g., Martin v. SCI Mgmt. L.P., 296 F.Supp.2d 462, 467 (S.D.N.Y.2003).
Section 2 of the FAA "requires courts to enforce agreements to arbitrate according to their terms," CompuCredit
Plaintiff advances two arguments why the EAP's class action waiver is unenforceable. Neither argument has merit.
Plaintiff first argues that the class action waiver in Defendant's EAP should not be enforced because the EAP carves out Plaintiff's rights under the National Labor Relations Act ("NLRA"). The EAP states:
McPeak Decl. Ex. 10 at 61 (emphasis omitted). Under the NLRA, employees have the right to "engage in . . . concerted activities for the purpose of . . . mutual aid or protection. . . ." 29 U.S.C. § 157. That phrase has been interpreted to include a right to proceed collectively in litigation or arbitration. See Eastex, Inc. v. NLRB, 437 U.S. 556, 566, 98 S.Ct. 2505, 57 L.Ed.2d 428 (1978) (recognizing that employees engage in concerted activity "when they seek to improve working conditions through resort to administrative and judicial forums."); see also In re D.R. Horton, Inc., Case 12-CA-25764, 2012 WL 36274, *2 (N.L.R.B. Jan. 3, 2012) (holding that arbitration is also protected as concerted activity). Consequently, Plaintiff claims that she should be permitted to arbitrate her claims collectively, notwithstanding the EAP's class action waiver.
This argument is unpersuasive. The EAP provides that "notwithstanding any other provision of this Program, if you . . . elect to arbitrate a Claim, . . . you . . . will [not] have the right . . . to . . . obtain relief from a class action. . . ." McPeak Decl. Ex. 10 at 66 (emphasis added). Under New York law, "clauses similar to the phrase `[n]otwithstanding any other provision' trump conflicting contract terms." Bank of N.Y. v. First Millennium, Inc., 607 F.3d 905, 917 (2d Cir.2010) (citing Int'l Multifoods Corp. v. Commercial Union Ins. Co., 309 F.3d 76, 90-91 (2d Cir.2002); L & B 57th St., Inc. v. E.M. Blanchard, Inc., 143 F.3d 88, 93 (2d Cir.1998); Morse/Diesel, Inc. v. Trinity Indus., Inc., 67 F.3d 435,
Finally, Plaintiff asserts that the class action waiver in Defendant's EAP should not be enforced because it violates section 157 of the NLRA. Plaintiff relies heavily on D.R. Horton, 2012 WL 36274, at **1, 5, in which the NLRB held that an employer violates the NLRA when "it requires employees. . . as a condition of their employment, to sign an agreement that precludes them from filing joint, class, or collective claims addressing their wages, hours or other working conditions against the employer in any forum, arbitral or judicial." The NLRB further held that the NLRA does not conflict with the FAA because the latter does not require a party to forgo substantive rights. Id. at *13. In the alternative, the NLRB indicated that if a conflict exists between the two statutes, the FAA must yield to the NLRA. Id. at *16. Although the Fifth Circuit refused to enforce D.R. Horton in this respect, see D.R. Horton, Inc. v. NLRB, 737 F.3d 344 (5th Cir.2013), the NLRB has recently reaffirmed its position in Murphy Oil USA, Inc., Case 10-CA-038804, 2014 WL 5465454 (N.L.R.B. Oct. 28, 2014).
In Sutherland v. Ernst & Young LLP, 726 F.3d 290, 296 (2013), the Second Circuit held that the FLSA, which has a grant of authority for collective action that is much more specific than that provided by the NRLA, see 29 U.S.C. § 216(b),
Other than pointing out that the NLRB has recently reiterated its view in the Murphy Oil decision,
For the forgoing reasons, Defendant's motion to compel arbitration is GRANTED. Because all claims are arbitrable, the case is dismissed. The Clerk of the Court is respectfully directed to terminate docket number 14 and to close the case.
29 U.S.C. § 216(b).