D.R. Horton, Inc. v. National Labor Relations Board

D.R. Horton, Inc. (Horton) (plaintiff) was a home builder that required its employees to sign a mutual arbitration agreement as a condition of employment. The agreement stated that Horton and the employees would submit disputes to arbitration and that the employees waived their right to a trial or civil proceeding regarding any claims. The agreement further provided that the arbitrator of a dispute could not authorize a class action or award relief to a group or class of employees in a singular arbitration proceeding. A class of employees sought to arbitrate claims concerning improper employee classification and overtime pay. Horton asserted that the agreement barred class arbitration but invited the employees to initiate individual arbitrations. The employees filed an unfair-labor-practice charge, alleging that the class-action waiver violated the National Labor Relations Act (NLRA). An administrative-law judge held that the agreement violated the NLRA because it reasonably made employees believe that they could not file charges with the National Labor Relations Board (board) (defendant). A panel of the board upheld the judge’s determination regarding the agreement but also found that the agreement violated the NLRA by requiring employees to waive their right to class actions in any forum. The panel ordered Horton to revise the agreement. Horton appealed to the Fifth Circuit.