Labor contracts are often tricky and scary because potential employees generally find it difficult to negotiate with employers for terms favorable to them, while employers use standard contracts with terms potential employees don’t understand or aren’t used to seeing, which guarantee the employers a better deal.
The National Labor Relations Act (“NLRA”), whose purpose is to provide protection to employees from unfair labor practices of employers, provides that an employer commits an unfair labor practice when it coerces or prevents employees from engaging in their legal rights, including, but not limited to, the rights of employees to band together in a union or otherwise. A recent case out of the United States Fifth Circuit Court of Appeals (“the Court”) addressed this problem in a labor contract case between a retail gas station and its employee.
Murphy Oil Inc. (“Murphy Oil”) operates retail gas stations in many cities in the United States, but the following dispute takes place at the Calera, Alabama location. Sheila Hobson, upon starting employment with Murphy Oil, was required to sign a binding arbitration agreement—an agreement which prevented herself and other employees working at this location from settling any disputes with management by any means other than arbitration—a process which would require both employee and employer to meet with a professional mediator for all legal claims.