Hobby Lobby Stores, Inc.

National Labor Relations Board - Administrative Judge Opinions

Sep 8, 2015

20-CA-139745 (N.L.R.B. Sep. 8, 2015)

JD(SF)–36–15
Sacramento, CA
UNITED STATES OF AMERICA
BEFORE THE NATIONAL LABOR RELATIONS BOARD
DIVISION OF JUDGES
HOBBY LOBBY STORES, INC.
and Case 20–CA–139745
THE COMMITTEE TO PRESERVE THE
RELIGIOUS RIGHT TO ORGANIZE
Yasmin Macariola, Esq., for the General Counsel.
Frank Birchfield, Esq.,
Christopher C. Murray, Esq.,
for the Respondent.
David Rosenfeld, Esq. for the Charging Party.
DECISION
STATEMENT OF THE CASE
ELEANOR LAWS, ADMINISTRATIVE LAW JUDGE. This case was tried based on a joint
motion and stipulation of facts I approved on June 29, 2015. The charge in this proceeding was
filed by the Committee to Preserve the Religious Right to Organize (the Charging Party) on
October 28, 2014, and a copy was served by regular mail on Respondent, on October 29, 2014.
The General Counsel issued the original complaint on January 28, 2015, and an amended
complaint on April 9, 2015. Hobby Lobby, Inc. (the Respondent or Company) filed timely
answers denying all material allegations and setting forth defenses.
On June 2, 2015, the General Counsel and the Respondent filed a joint motion to submit a
stipulated record to the Administrative Law Judge (Joint Motion). The Charging Party did not
join the Joint Motion. On June 3, I issued an order granting the Charging Party until June 17, to
file a response to the Joint Motions, including any objections to it. On June 17, the Charging
Party filed objections to the Joint Motion, and the General Counsel and the Respondent, replied
JD(SF)–36–15
2
to the objections, respectively, on June 23 and 24. I issued an order granting the Joint Motion
over the Charging Party’s objections on June 29.1
The following issues are presented:
5
1. Whether the Respondent’s Mandatory Arbitration Agreement (MAA) and related
policies maintained by the Respondent, which requires employees, as a condition of
employment, to waive their right to resolution of employment- related disputes by
collective or class action violates Section 8(a)(l) of the National Labor Relations Act
(the Act).10
2. Whether the MAA maintained by the Respondent would reasonably be read by
employees to prohibit them from filing unfair labor practice charges with the Board in
violation of Section 8(a)(l) of the Act.
15
3. Whether the Respondent's enforcement of the MAA through its motions to compel
arbitration in Jeremy Fardig v. Hobby Lobby Stores, Inc., 8:14-cv-00561-JVS-AN,
U.S.D.C., Central District of California; and Ortiz v. Hobby Lobby Stores, Inc., 2:13-
cv-01619-TLN-DAD, U.S.D.C., Eastern District Court of California, violates Section
8(a)( l) of the Act.20
On the entire record, including my observation of the demeanor of the witnesses, and
after considering the briefs filed by the General Counsel, the Respondent, and the Charging
Party, I make the following
25
FINDINGS OF FACT
I. JURISDICTION
At all material times, the Respondent, an Oklahoma corporation with several stores 30
throughout the State of California, including one in Sacramento, California, has been engaged in
business as a retailer specializing in arts, crafts, hobbies, home decor, holiday, and seasonal
products. The parties admit, and I find, that at all material times, Respondent has been an
employer engaged in commerce within the meaning of Section 2(2), (6) and (7) of the Act.
35

1 The June 3, 2015, order is hereby admitted into the record as administrative law judge (ALJ) Exhibit
1, the Charging Party’s June 17 response is admitted as ALJ Exhibit 2, the General Counsel’s June 23
reply is admitted as ALJ Exhibit 3, and the Respondent’s June 24 reply is admitted as ALJ Exhibit 4. The
following abbreviations are used for citations in this decision: “Jt. Mot.” for the General Counsel and
Respondent’s joint motion; “Jt. Exh.” for the exhibits attached to the joint motion; “GC Br.” for the
General Counsel’s brief; “R Br.” for the Respondents’ brief; and “CP Br.” for the Charging Party’s brief.
Although I have included several citations to the record to highlight particular exhibits, I emphasize that
my findings and conclusions are based not solely on the evidence specifically cited, but rather are based
my review and consideration of the entire record.
JD(SF)–36–15
3
II. FACTS
The Respondent, Hobby Lobby, is a national retailer of arts, crafts, hobby supplies, home
accents, holiday, and seasonal products. It operates approximately 660 stores in 47 states. 5
The Respondent employs individuals in various job titles including but not limited to the
following: office clericals; security staff; cashiers; stockers; floral designers; picture framers;
media buyers; craft designers; graphic & web designers; production artists; video tutorial hosts;
leave assistants; production quality and compliance assistants; construction warehouse workers; 10
customer service representatives; industrial engineers; inventory control specialists; maintenance
technicians; packers/order pullers; photo editors; truck-trailer technicians; truck-trailer technician
trainees; social media writers; sales and use tax accountants; and team truck drivers who
transport Respondent’s products across state lines. (Jt. Mot. ¶ 4(a) & ¶ 4(b).)
15
Upon commencing employment, all employees receive a copy of the Respondent’s
employee handbook. There are two different versions of the employee handbook—one for
employees in California and one for employees outside of California. Employees must sign in
receipt of the handbook and agree to be bound by its terms. The version applicable to employees
in California states2:20
By my signature below, I acknowledge that I have received a copy of the Company's
California Employee Handbook (“Employee Handbook”). I understand this Employee
Handbook contains important information on the Company's policies, procedures, and
rules. It also contains my obligations as an employee.25
I understand that this Employee Handbook replaces and supersedes any and all previous
employee handbooks that I may have received, or agreements or promises made by any
representative of the Company other than a Corporate Officer prior to the date of my
signature below, and that I cannot rely upon any promises or representations made to me 30
by anyone concerning the terms and conditions of my employment that are contrary to or
inconsistent with this Employee Handbook, or any subsequent written modifications or
revisions to this Employee Handbook posted on the Company's Employee Information
Boards.
35
I understand that my employment with the Company is conditioned upon the contents of
this Employee Handbook. I further understand that, with the exception of the Submission
of Disputes to Binding Arbitration section of this Employee Handbook and the Mutual
Arbitration Agreement, the Company may alter, change, amend, rescind, or add to any
policies, procedures, or rules set forth in this Employee Handbook from time to time with 40
or without prior notice. I further understand that the Company will notify me of any
material changes to this Employee Handbook, and that, by continuing employment after
being so notified of such changes, I acknowledge, accept, and agree to such changes as a
condition of my employment and continued employment.

2 The acknowledgment of the handbook does not materially differ for employees outside of California
for purposes of this decision.
JD(SF)–36–15
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I understand that the employment relationship between me and the Company is at-will. I
am employed on an at-will basis, as are all Company employees, and nothing to the
contrary stated anywhere in this Employee Handbook or by any Company representative
changes my or any employee's at-will status. I am free to resign at any time, for any 5
reason, with or without notice. Similarly, the Company is free to terminate my
employment at any time, for any reason, or for no reason at all. I also understand that
nothing in this Employee Handbook is to be construed as creating, whether by
implication or otherwise, any legal or contractual obligations or restrictions upon the
Company's ability to terminate me as an employee at-will, for any reason at any time. 10
Further, no person, other than a Corporate Officer of the Company, may enter into any
written agreement amending this at-will employment policy or otherwise alter the at-will
employment status of any employee.
By my signature below, I acknowledge that I have read and understand the provisions of 15
this Employee Handbook and agree to abide by all Company policies, procedures,
practices, and rules.
Since at least April 28, 2014, the Respondent has maintained the MAA in its employee
handbook. The MAA requires employees to waive resolution of employment-related disputes by 20
class, representative or collective action or other otherwise jointly with any other person. Since
at least April 28, 2014, the Respondent has required all of its employees to enter into the MAA in
order to obtain and maintain employment with the Respondent. (Jt. Mot. ¶ 4(e) & ¶ 4(i).)
The MAA provides, in relevant part:25
This Mutual Arbitration Agreement ("Agreement"), by and between the undersigned
employee ("Employee") and the Company, is made in consideration for the continued at-
will employment of Employee, the benefits and compensation provided by Company to
Employee, and Employee's and Company 's mutual agreement to arbitrate as provided in 30
this Agreement. Employee and Company hereby agree that any dispute, demand, claim,
controversy, cause of action, or suit (collectively referred to as "Dispute") that Employee
may have, at any time following the acceptance and execution of this Agreement, with or
against Company, its affiliates, subsidiaries, officers, directors, agents, attorneys,
representatives, and/or other employees, that in any way arises out of, involves, or relates 35
to Employee's employment with Company or the separation of Employee's employment
with Company (including without limitation, all Disputes involving wrongful
termination, wages, compensation, work hours, . . . sexual harassment, harassment and/or
discrimination based on any class protected by federal, state or municipal law, and all
Disputes involving interference and/or retaliation relating to workers' compensation, 40
family or medical leave, health and safety, harassment, discrimination, and/or the
opposition of harassment or discrimination, and/or any other employment-related Dispute
in tort or contract), shall be submitted to and settled by final and binding arbitration in the
county and state in which Employee is or was employed. Such arbitration shall be
conducted pursuant to the American Arbitration Association's National Rules for the 45
Resolution of Employment Disputes or the Institute for Christian Conciliation's Rules of
Procedure for Christian Conciliation, then in effect, before an arbitrator licensed to
JD(SF)–36–15
5
practice law in the state in which Employee is or was employed and who is experienced
with employment law. . . . The parties agree that all Disputes contemplated in this
Agreement shall be arbitrated with Employee and Company as the only parties to the
arbitration, and that no Dispute contemplated in this Agreement shall be arbitrated, or
litigated in a court of law, as part of a class action, collective action, or otherwise jointly 5
with any third party. Prior to submitting a Dispute to arbitration, the aggrieved party shall
first attempt to resolve the Dispute by notifying the other party in writing of the Dispute.
If the other party does not respond to and resolve the Dispute within 10 days of receipt of
the written notification, the aggrieved party then may proceed to arbitration. The parties
agree that the decision of the arbitrator shall be final and binding. Judgment on any award 10
rendered by an arbitrator may be entered and enforced in any court having jurisdiction
thereof.
This Agreement between Employee and Company to arbitrate all employment-related
Disputes includes, but is not limited to, all Disputes under or involving Title VII of the 15
Civil Rights Act of 1964, the Civil Rights Acts of 1866 and 1991, the Age Discrimination
in Employment Act, the Americans with Disabilities Act, the Family and Medical Leave
Act, the Fair Labor Standards Act, the Equal Pay Act, the Fair Credit Act, the Employee
Retirement Income Security Act, and all other federal, state, and municipal statutes,
regulations, codes, ordinances, common laws, or public policies that regulate, govern, 20
cover, or relate to equal employment, wrongful termination, wages, compensation, work
hours, invasion of privacy, false imprisonment, assault, battery, malicious prosecution,
defamation, negligence, personal injury, pain and suffering, emotional distress, loss of
consortium, breach of fiduciary duty, sexual harassment, harassment and/or
discrimination based on any class protected by federal, state or municipal law, or 25
interference and/or retaliation involving workers' compensation, family or medical leave,
health and safety, harassment, discrimination, or the opposition of harassment or
discrimination, and any other employment-related Dispute in tort or contract. This
Agreement shall not apply to claims for benefits under unemployment compensation laws
or workers' compensation laws.30
By agreeing to arbitrate all Disputes, Employee and Company understand that they are
not giving up any substantive rights under federal, state, or municipal law (including the
right to file claims with federal, state; or municipal government agencies). Rather,
Employee and Company are mutually agreeing to submit all Disputes contemplated in 35
this Agreement to arbitration, rather than to a court. Company shall bear the
administrative costs and fees assessed by the arbitration provider selected by Employee:
either the American Arbitration Association or the Institute for Christian Conciliation.
Company shall be solely responsible for paying the arbitrator's fee. Except for those
Disputes involving statutory rights under which the applicable statute may provide for an 40
award of costs and attorney's fees, each party to the arbitration shall be solely
responsible for its own costs and attorney's fees, if any, relating to any Dispute and/or
arbitration. Should any party institute any action in a court of law or equity against the
other party with respect to any Dispute required to be arbitrated under this Agreement,
the responding party shall be entitled to recover from the initiating party all costs, 45
expenses, and attorney fees incurred to enforce this Agreement and compel arbitration,
and all other damages resulting from or incurred as a result of such court action.
JD(SF)–36–15
6
Every individual who works for Company must have signed and returned to his/her
supervisor this Agreement to be eligible for employment and continued employment with
Company. Further, Employee's employment or continued employment will evidence
Employee's acceptance of this Agreement. Employee acknowledges and agrees that 5
Company is engaged in transactions involving interstate commerce, that this Agreement
evidences a transaction involving commerce, and that this Agreement is subject to the
Federal Arbitration Act. If any specific provision of this Agreement is invalid or
unenforceable, the remainder of this Agreement shall remain binding and enforceable.
This Agreement constitutes the entire mutual agreement to arbitrate between Employee 10
and Company and supersedes any and all prior or contemporaneous oral or written
agreements or understandings regarding the arbitration of employment-related Disputes.
This Agreement is not, and shall not be construed to create, a contract of employment,
express or implied, and shall not alter Employee's at-will employment status.
15
Employee and Company acknowledge that they have read this Mutual Arbitration
Agreement, are giving up any right they might have at any point to sue each other, are
waiving any right to a jury trial, and are knowingly and voluntarily consenting to all
terms and conditions set forth in this Agreement.
20
(Jt. Exhs. I, J.) The MAA is also part of the application for employment with the Respondent.
(Jt. Exhs. K, L.) It has its own signature requirement. The signed MAA is included in each new
employee’s “new employee packet” and is filed in the employee’s personnel file. (Jt. Exhs. M–
X.) During the period of December 18, 2010 to December 18, 2014, Respondent hired
approximately 65,880 employees and re-hired approximately 6,324 employees for a total of 25
approximately 72,204 recipients of the MAA. (Jt. Mot. ¶ 4(h).)
On December 3, 2013, the Respondent filed a motion in the United States District Court
for the Eastern District of California to dismiss individual and representative wage-related claims
a former employee had filed against it under California law, in Ortiz v. Hobby Lobby Stores, Inc., 30
2:13-cv-01619-TLN-DAD (E.D. Cal.). (Jt. Exh. Y; Jt. Mot. ¶ 5.) The Respondent moved, in the
alternative, pursuant to the Federal Arbitration Act (FAA), to compel individual arbitration of
plaintiff’s claims under the MAA the plaintiff had signed when she began her employment. (Jt.
Exh. Y.)
35
On April 17, 2014, the Respondent filed a motion seeking to dismiss a putative class
action lawsuit filed by multiple employees alleging wage and hour claims against it under
California law in Fardig v. Hobby Lobby Stores, Inc., 8:14-cv-00561-JVSAN (C.D. Cal.). (Jt.
Exh. Z; Jt. Mot. ¶ 5.) In the alternative, pursuant to FAA, the Respondent moved to compel
individual arbitration under the MAAs signed by each named plaintiff. (Joint Ex. 2Z.) On June 40
13, 2014, the U.S. District Court for the Central District of California granted the Respondent’s
motion to compel individual arbitration under the MAA. Fardig v. Hobby Lobby Stores Inc.,
2014 WL 2810025 (C.D. Cal. June 13, 2014). The Fardig court rejected the plaintiffs’ arguments
that the MAA was unenforceable under California law and under the National Labor Relations
Act pursuant to the Board’s decision in D. R. Horton, Inc., 357 NLRB No. 184 (2012), enf. 45
granted in part and denied in part, 737 F.3d 344 (5th Cir. 2013).
JD(SF)–36–15
7
On October 1, 2014, the U.S. District Court for the Eastern District of California in the
Ortiz case granted the Respondent’s motion to compel individual arbitration under the MAA.
Ortiz v. Hobby Lobby Stores, Inc., 52 F.Supp. 3d 1070 (E.D. Cal. 2015). The court considered
the Board’s decision in D. R. Horton, and concluded its reasoning conflicted with the FAA and
the Supreme Court’s decision in AT&T Mobility LLC v. Concepcion, 131 S.Ct. 1740 (2011).5
III. DECISION AND ANALYSIS
A. The MAA’s Prohibition on Class and Collective Legal Claims
10
Complaint paragraphs 4(a), (c), (d), and 5 allege that, at all material times since at least April
28, 2014, the Respondent has maintained the MAA, which requires employees to waive their
right to resolution of employment-related disputes by collective or class action, as a condition of
employment, in violation of Section 8(a)(1) of the Act.
15
Under Section 8(a)(1), it is an unfair labor practice for an employer to interfere with,
restrain, or coerce employees in the exercise of the rights guaranteed in Section 7 of the Act.
The rights guaranteed in Section 7 include the right “to form, join or assist labor organizations, to
bargain collectively through representatives of their own choosing, and to engage in other
concerted activities for the purpose of collective bargaining or other mutual aid or protection . . 20
.”
1. Application of D. R. Horton and Murphy Oil
When evaluating whether a rule, including a mandatory arbitration agreement, violates 25
Section 8(a)(1), the Board applies the test set forth in Lutheran Heritage Village-Livonia, 343
NLRB 646 (2004).3 See U-Haul Co. of California, 347 NLRB 375, 377 (2006), enfd. 255
Fed.Appx. 527 (D.C. Cir. 2007); D. R. Horton, supra. Under Lutheran Heritage, the first inquiry
is whether the rule explicitly restricts activities protected by Section 7. If it does, the rule is
unlawful. If it does not, “the violation is dependent upon a showing of one of the following: (1) 30
employees would reasonably construe the language to prohibit Section 7 activity; (2) the rule
was promulgated in response to union activity; or (3) the rule has been applied to restrict the
exercise of Section 7 rights.” Lutheran Heritage at 647.
Because the MAA explicitly prohibits employees from pursuing employment-related 35
claims on a class or collective basis, I find it violates Section 8(a)(1). The right to pursue
concerted legal action, including class complaints, addressing wages, hours, and working
conditions falls within Section 7’s protections. See, e.g., Murphy Oil USA, Inc., 361 NLRB No.
72 (2014); D. R. Horton, supra;4 see also Eastex, Inc. v. NLRB, 437 U.S. 556, 566 (1978)(Section
7 protects employee efforts seeking “to improve working conditions through resort to 40

3 The Charging Party argues that Lutheran Heritage should be overruled. Any arguments regarding
the legal integrity of Board precedent, however, are properly addressed to the Board.
4 The Board in Murphy Oil reexamined D. R. Horton, and determined that its reasoning and results
were correct.
Deference and the Federal Arbitration Act, 128 Harv. L. Rev. 907 (January 12, 2015), provides a
well-reasoned explanation as to why the Board’s conclusion that collective and class litigation is
protected Section 7 activity should be accorded deference by the courts.
JD(SF)–36–15
8
administrative and judicial forums; Spandsco Oil & Royalty Co., 42 NLRB 942, 948-949 (1942);
Salt River Valley Water Users Assn., 99 NLRB 849, 853-854 (1952), enfd. 206 F.2d 325 (9th
Cir. 1953); Brady v. National Football League, 644 F.3d 661, 673 (8th Cir. 2011) (“lawsuit filed
in good faith by a group of employees to achieve more favorable terms or conditions of
employment is ‘concerted activity’ under §7 of the National Labor Relations Act.”); Trinity 5
Trucking & Materials Corp. v. NLRB, 567 F.2d 391 (7th Cir. 1977) (mem. disp.), cert. denied,
438 U.S. 914 (1978). Accordingly, an employer rule or policy that interferes with such actions
violates Section 8(a)(1). D. R. Horton, supra.; Murphy Oil, supra; See also Chesapeake Energy
Corp., 362 NLRB No. 80 (2015); Cellular Sales of Missouri, 362 NLRB No. 27 (2015); The
Neiman Marcus Group, Inc., 362 NLRB No. 157 (2015); Countrywide Financial Corp., 362 10
NLRB No. 165 (2015); PJ Cheese Inc., 362 NLRB No. 177 (2015); Leslie’s Pool Mart, Inc., 362
NLRB No. 184 (2015); On Assignment Staffing Services, 362 NLRB No. 189 (2015).
The Respondent propounds numerous arguments as to why D. R. Horton and its progeny
should be overturned.5 (R Br. 6–48.) I am, however, required to follow Board precedent, unless 15
and until it is overruled by the United States Supreme Court.6 See Gas Spring Co., 296 NLRB
84, 97 (1989) (citing, inter alia, Insurance Agents International Union, 119 NLRB 768 (1957),
revd. 260 F.2d 736 (D.C. Cir. 1958), affd. 361 U.S. 477 (1960)), enfd. 908 F.2d 966 (4th Cir.
1990), cert. denied 498 U.S. 1084 (1991). Applying the above-cited Board precedent, I find the
MAA violates Section 8(a)(1). 20
Though the Board has made its ruling on the issue clear, I will address the Respondent’s
arguments that have not been as fully covered by previous decisions. The Respondent contends
that a class action waiver does not abridge employees’ right to seek class certification to any
greater extent than an employer’s filing an opposition to an employee’s motion for class 25
certification. Of course it does; the former precludes the right, the latter responds to it. And it is
apparent the waiver gives the opposition teeth. The Respondent then adds the element of success
to the employer’s motion to secure its argument. Success of the employer’s motion cannot be
presumed, however. The Respondent’s argument thus fails.
30
The Respondent also contends that the Board’s decisions stand for the proposition that
employees have the right to have certification decisions heard on their merits. The Board has
made no such holding or suggestion. If, by way of the example cited in the Respondent’s brief,
the class representative misses a filing deadline, nothing in any of the Board’s cases suggests a
court must nonetheless decide class certification on the merits. 35
As to the Respondent’s assertion that there is no basis in the NLRA, the Federal Rules, or
case law for D .R. Horton’s presumption that class procedures were created to serve any
concerns or purposes under the NLRA, the Board has not relied on such concerns or purposes.

5 Many of these arguments are in line with the dissents in D. R. Horton and Murphy Oil. Numerous
Board and ALJ decisions have addressed the specific arguments raised by the Respondent and there is
nothing I can add in this decision that has not already been addressed repeatedly.
6 The Respondent contends that, because the Board did not petition for a writ of certiorari to
challenge the Fifth Circuit’s rejection of the relevant part of D.R Horton, and because that decision rests
primarily on interpretation of a statute other than the NLRA, I should not be constrained by Board
precedent. No authority was cited for this contention, however, and I therefore decline to stray from the
Board’s established caselaw on this point.
JD(SF)–36–15
9
Two employees who together file charges with the Equal Employment Opportunity Commission
(EEOC) about racial harassment are engaged in concerted activity about their working
conditions, though the EEOC’s charge processing procedures were certainly not created to serve
any concerns or purposes under the NLRA. The EEOC’s procedures, like class procedures in
court, are one of many avenues available for concerted legal activity, regardless of the purposes 5
those procedures were intended to serve.
The Respondent next appears to be arguing that employees can, albeit in vain, file
putative class action lawsuits despite the MAA, suffer no adverse consequences for it, and
therefore the MAA does not infringe on their rights. There need not be adverse consequences for 10
non-adherence to the MAA for it to violate the Act. Moreover, the MAA on its face spells out
adverse consequences for filing putative class actions. The MAA states, in relevant part:
Should any party institute any action in a court of law or equity against the other party
with respect to any Dispute required to be arbitrated under this Agreement, the 15
responding party shall be entitled to recover from the initiating party all costs, expenses,
and attorney fees incurred to enforce this Agreement and compel arbitration, and all other
damages resulting from or incurred as a result of such court action.
Thus, in addition to breaking an agreement with the employer not to sue as an express condition 20
of continued employment, an employee who files a putative class action may be assessed with
fees and damages.
The Respondent also contends that the Board in D. R. Horton misinterpreted the Norris-
LaGuardia Act (NGLA) when determining it prohibits the enforcement of agreements like the 25
FAA. The Board recently reaffirmed its position that the FAA must yield to the NLGA, stating
The Board has previously explained why “even if there were a direct conflict between the
NLRA and the FAA, the Norris-LaGuardia Act . . . indicates that the FAA would have to
yield insofar as necessary to accommodate Section 7 rights.” An arbitration agreement 30
between an individual employee and an employer that completely precludes the
employee from engaging in concerted legal activity clearly conflicts with the express
federal policy declared in the Norris-LaGuardia Act. That conflict in no way depends on
whether the agreement is properly characterized as a condition of employment. By its
plain terms, the Norris-LaGuardia Act sweepingly condemns “[a]ny undertaking or 35
promise . . . in conflict with the public policy declared” in the statute: insuring that the
“individual unorganized worker” is “free from the interference, restraint, or coercion of
employers . . . in . . . concerted activities for the purpose of . . . mutual aid or protection,”
including “[b]y all lawful means aiding any person participating or interested in any labor
dispute who . . . is prosecuting, any action or suit in any court of the United States or any 40
state.”
On Assignment Staffing Services, supra, slip op. at 10 (Emphasis in original, internal citations
and footnotes omitted.)
45
JD(SF)–36–15
10
2. The MAA as an employment contract
The Charging Party also asserts that the FAA does not apply because there is no
employment contract, citing to the Supreme Court’s decisions in Circuit City Stores Inc. v.
Adams, 532 U.S. 105, 113–114 (2001), Buckeye Check Cashing, Inc. v. Cardegna, 546 U.S. 440, 5
445 (2006), and Allied-Bruce Terminix Companies, Inc. v. Dobson, 513 U.S. 265, 277 (1995). 7
The Charging Party points out that the MAA itself states, “[t]his Agreement is not, and shall not
be construed to create, a contract of employment, express or implied, and shall not alter
Employee's at-will employment status.” The employees’ at-will status is also set forth in the
introductory paragraph of the employee handbook. (Jt. Exh. I p. 5; Jt. Exh. J p. 5.) 10
The Charging Party notes that the Respondent has not offered evidence or argument that
a contract of employment has been created by virtue of the MAA in any of the states where it
operates. Resolution of this issue would involve delving into each state’s body of contract law.8
Because it is not required to support my conclusion herein that the MAA violates Section 8(a)(1), 15
I decline to undertake this enormous task, the legal aspects of which none of the parties have
addressed in their briefs.
3. The MAAs and commerce
20
The Charging Party argues that there is no evidence the individual MAAs with the
Respondent’s employees affect commerce, and asserts that the activity of arbitration does not
affect interstate commerce. This raises the fundamental question of what, in fact, is the
“transaction involving commerce” the MAA evidences to bring it within the FAA’s reach?
25
The FAA, at 9 USC § 2, applies to a “written provision in any maritime transaction or a
contract evidencing a transaction involving commerce to settle by arbitration a controversy
thereafter arising out of such contract or transaction . . .” Specifically excluded, however, are

7 The Charging Party also asserts that MAA, when coupled with the Respondent’s confidentiality
policy, solicitation policy, loitering policy, email usage policy, computer usage policy, and/or return of
company property policy, provide other bases for finding it unlawful. I agree that these policies, when
viewed in conjunction with the MAA, act as further barriers to employees discussing their arbitrations
under the MAA and/or garnering support from fellow employees. The complaint, however, does not
allege that any policy other than the MAA violates the Act, and therefore my conclusions are limited to
the MAA. See Penntech Papers, 263 NLRB 264, 265 (1982); Kimtruss Corp., 305 NLRB 710, 711
(1991).
The Charging Party sets forth numerous other arguments, including the FAA’s impact on
other federal and state statutes, the rights of workers to organize under the Religious Freedom
Restoration Act (RFRA), and the effect of the MAA on union representation. I have considered
each argument in the Charging Party’s brief. Because this case can be decided by applying the
Board precedent discussed above, I do not address all of the Charging Party’s arguments.
8 For example, under Minnesota law, the disclaimer language in the MAA may negate the existence
of a contract. See Kulkay v. Allied Central Stores, Inc., 398 N.W.2d 573, 578 (Minn.Ct.App.1986). By
contrast, in Circuit City, the Court of Appeals for the Ninth Circuit determined the dispute resolution
agreement at issue, with disclaimer language almost identical to the agreement at issue here, was an
“employment contract.” Circuit City Stores, Inc. v. Adams, 194 F.3d 1070 (1999); See also Ashbey v.
Archstone Property Management, Inc., 2015 WL 2193178 (9th Cir. 2015).
JD(SF)–36–15
11
“contracts of employment of seamen, railroad employees, or any other class of workers engaged
in foreign or interstate commerce.” 9 USC § 1. The Supreme Court in Circuit City interpreted
this exclusionary provision, “any other class of workers engaged in foreign or interstate
commerce,” narrowly, and held it applied only to workers actually working in commercial
industries similar to seamen and railroad employees. Relying on Allied-Bruce Terminix 5
Companies, Inc. v. Dobson, 513 U.S. 265 (1995),9 the Court in Circuit City interpreted Section
2’s inclusion provision, a “contract evidencing a transaction involving commerce,” broadly,
finding it was not limited to transactions similar to maritime transactions.10 In line with these
interpretations, most contracts of employment fall within the FAA’s reach, regardless of whether
the employees themselves are involved in any traditionally-defined commercial transactions as 10
part of their work.
In Allied-Bruce Terminix, supra, the Supreme Court examined the phrase “evidencing a
transaction” involving commerce and determined that “the transaction (that the contract
‘evidences’) must turn out, in fact . . . [to] have involved interstate commerce[.]” (emphasis in 15
original). A prior Supreme Court case, Bernhardt v. Polygraphic Co. of America, 350 U.S. 198
(1956), that like Circuit City and Allied-Bruce Terminix interpreted the words “involving
commerce” as broadly as the words “affecting commerce,”11 involved an employment contract
between Polygraphic Co., an employer engaged in interstate commerce, and Norman Bernhardt,
the superintendent of Polygraphic Co.’s Vermont plant. The employment contract at issue 20
contained a provision that in case of any dispute, the parties would submit the matter to
arbitration by the American Arbitration Association.

9 The Court in Allied-Bruce found that the term “involving” was the same as “affecting” and that the
phrase “‘affecting commerce’ normally signals Congress' intent to exercise its Commerce Clause powers
to the full.” 513 U.S. at 273–275.
10 Though I am bound by the majority’s decision in Circuit City, I find the dissenting opinions, and in
particular Justice Souter’s explanation of why the Court's “parsimonious construction of § 1 of the . . .
FAA . . . is not consistent with its expansive reading of § 2,” more sound and compelling. Presumably
the result of adherence to precedent, the phrase “contract evidencing a transaction involving commerce”
is not seen as a residual phrase following the specific category of maritime transactions in § 2, but the
phrase “any other class of workers engaged in foreign or interstate commerce” is seen as a residual phrase
following the specific categories of seamen and railroad employees in § 1. This distinction supplied the
Court’s rationale for applying the maxim ejusdem generis to “any other class of workers engaged in
foreign or interstate commerce” to support its finding that employment contracts are covered by the FAA.
“Maritime transactions” is defined in § 1 by way of listing various transactional contracts, such as
charter parties, bills of lading, and agreements relating to supplies and vessels. Applying ejusdem
generis, the expansive definition given to the phrase “contract evidencing a transaction involving
commerce,” fails to give independent meaning to the term “maritime transaction.”
11 Allied-Bruce Terminix, supra, at 277.
JD(SF)–36–15
12
The Supreme Court found the FAA did not apply because the company did not show that the
employee, “while performing his duties under the employment contract was working ‘in’
commerce, was producing goods for commerce, or was engaging in activity that affected
commerce, within the meaning of our decisions.”12
5

12 The agreement provided for the employment of Bernhardt as the superintendent of Polygraphic
Co.’s lithograph plant in Vermont. Its terms stated:
“Subject to the general supervision and pursuant to the orders, advice and direction of the Employer,
Employee shall have charge of and be responsible for the operation of said lithographic plant in North
Bennington, shall perform such other duties as are customarily performed by one holding such position in
other, same or similar businesses or enterprises as that engaged in by the Employer, and shall also
additionally render such other and unrelated services and duties as may be assigned to him from time to
time by Employer.
“Employer shall pay Employee and Employee agrees to accept from Employer, in full payment for
Employee's services hereunder, compensation at the rate of $15,000.00 per annum, payable twice a month
on the 15th and 1st days of each month during which this agreement shall be in force; the compensation
for the period commencing August 1, 1952 through August 15, 1952 shall be payable on August 15,
1952. In addition to the foregoing, Employer agrees that it will reimburse Employee for any and all
necessary, customary and usual expenses incurred by him while traveling for and on behalf of the
Employer pursuant to Employer's directions.
“It is expressly understood and agreed that Employee shall not be entitled to any additional
compensation by reason of any service which he may perform as a member of any managing committee
of Employer, or in the event that he shall at any time be elected an officer or director of Employer.
“The parties hereto do agree that any differences, claim or matter in dispute arising between them out
of this agreement or connected herewith shall be submitted by them to arbitration by the American
Arbitration Association, or its successor and that the determination of said American Arbitration
Association or its successors, or of any arbitrators designated by said Association, on such matter shall be
final and absolute. The said arbitrator shall be governed by the duly promulgated rules and regulations of
the American Arbitration Association, or it its successor, and the pertinent provisions of the Civil Practice
Act of the State of New York relating to arbitrations [section 1448 et seq.]. The decision of the arbitrator
may be entered as a judgment in any court of the State of New York or elsewhere.
“The parties hereto do hereby stipulate and agree that it is their intention and covenant that this
agreement and performance hereunder and all suits and special proceedings hereunder be construed in
accordance with and under and pursuant to the laws of the State of New York and that in any action
special proceedings or other proceeding that may be brought arising out of, in connection with or by
reason of this agreement, the laws of the State of New York shall be applicable and shall govern to the
exclusion of the law of any other forum, without regard to the jurisdiction in which any action or special
proceeding may be instituted.” 218 F.2d 948, 949–950 (2d Cir. 1955).
JD(SF)–36–15
13
Here, the contract at issue is the MAA.13 There is no other employment contract
implicated in the complaint or the answer.14 By virtue of the MAA, the employee and employer
have transacted an agreement to resolve employment disputes through arbitration. What is
analytically more difficult about the MAA and similar agreements, when compared with most
contracts, is that the arbitration agreement itself is part of the consideration for the transaction. 5
The agreement here states that the “Mutual Arbitration Agreement . . . is made in consideration
for the continued at-will employment of the Employee, the benefits and compensation provided
by Company to Employee, and Employee’s and Company’s mutual agreement to arbitrate as
provided in this Agreement.”15 (Jt. Exh. I p. 55; Jt. Exh. J p. 56.) Generally, when a contract is
involved, the arbitration agreement is a means to solve a contract dispute, and the terms of the 10
agreement spell out independent consideration. For example, in Allied-Bruce Terminix,
consideration for the termite bond at issue was money. In Buckeye Check Cashing, individuals
entered into “various deferred-payment transactions with . . . Buckeye . . . in which they
received cash in exchange for a personal check in the amount of the cash plus a finance charge.”
546 U.S. at 440. In Gilmer v. Interstate/Johnson Lane Corp., 500 U.S. 20 (1991), the arbitration 15
agreement was part of an application to register with the New York Stock Exchange. In none of
these cases was the agreement to arbitrate itself consideration in the “contract evidencing a
transaction involving commerce.”
The MAA’s terms, including the “consideration” of the individual arbitral process, are 20
not implicated until there is an employment dispute. In other words, an employment dispute is a
condition precedent to performance under the MAA. In typical transactions, a dispute is not
necessary for the terms of the agreement to be exercised. For example, in Buckeye, the check
cashing company provided cash to the individuals as consideration for the individuals signing
over their checks and paying a fee. These transactions could play out indefinitely without the 25
arbitration agreement provision ever coming into play. If the individuals in Buckeye performed
their end of the bargain by turning over their checks and the check cashing company sat idle, a
dispute would arise. Conversely, there would be no need for the check cashing company to do
anything if the individual never presented it with a check to cash. Not so here, if the employees’
work is part of the consideration. At all times prior to the advent of a covered dispute and the 30
invocation of a way to resolve it, the employer is continuing to employ the employee and the
employee is continuing to perform work for the employer. Continued employment triggers no

13 I have not been asked to decide whether the entire employee handbook is a contract, and make no
findings on this point.
There is no evidence here of any contract setting forth payment, duties, etc. of the various employees’
jobs, as in Bernhardt. This renders the interpretation in this decision narrower than in Bernhardt because
I am not looking at a broader employment contract, with an agreement to arbitrate disputes embedded in
it, and whether that contract has been breached based on the terms of that contract. Instead, I am looking
at whether any employment dispute covered by the contract, here the MAA, evidences a transaction
involving commerce.
14 It strikes me as peculiar that the contract to arbitrate itself is the contract at issue to determine
applicability of the FAA, rather than an external contract or agreement subject to an arbitration provision.
In most cases, the arbitration agreement would kick in if there was a dispute as to performance under the
terms of the agreement. Here, a dispute regarding performance under the terms of the MAA would
concern whether the employee submitted a covered dispute to arbitration in line with the MAA, or
breached the agreement by filing a lawsuit in court.
15 Oddly, by this language the MAA is in part made in consideration for itself.
JD(SF)–36–15
14
duty on the employer or the employee with regard to the MAA.16 The employee deciding not to
continue employment with the Respondent, without more, likewise triggers no duty under the
MAA. It is difficult to see, therefore, how continued employment is part of the “transaction” the
MAA evidences.
5
Simply put, the MAA is a contract about how employment disputes will be resolved. The
“transactions” evidenced by the MAA are agreements to arbitrate any and all employment
disputes. Yes, the MAA is a condition of employment, but its topic is not the work the
employees will perform or the conditions under which they will perform it. An employer
engaged in interstate commerce could require employees, as a condition of employment, to sign 10
an agreement stating that they will sit with their coworkers for lunchtime on Tuesdays.17 The
topic of this agreement is not the employee’s work duties or the employer’s business, but rather
who the employees will eat lunch with on Tuesdays. It certainly would seem a stretch to find that
this agreement would be a “maritime transaction or a contract evidencing a transaction involving
commerce.” 15
As noted above, the MAA applies to all employees. As the Charging Party points out,
some disputes covered by the MAA with some of these employees would likely affect
commerce, and other minor disputes likely would not. Take the example of a security worker
who walks a block to work (not across state lines) at the same Hobby Lobby store each day. It is 20
hard to see how an individual arbitration, required by the MAA, about a disagreement over the
timing of this security worker’s lunch break evidences any transaction involving commerce. The
fact that the employer is engaged in interstate commerce does not, in my view, render any
individual agreement to arbitrate an employment dispute as a “contract evidencing a transaction
involving commerce” because it is not the employer’s business of producing and selling goods in 25
interstate commerce comprising the “transaction” evidenced by the MAA. To interpret the FAA
this broadly would finally stretch it to its breaking point.18
Even if the “transaction” the MAA contemplates is employment or continued
employment under the MAA’s terms, the individual agreements do not necessarily “evidence a 30
transaction involving commerce.” As in Bernhardt, not all of the Respondent’s employees,
while performing their duties, are “‘in’ commerce, . . . producing goods for commerce, or . . .
engaging in activity that affect[s] commerce . . . .”
Consideration of the Supreme Court’s decision in Citizens Bank v. Alafabco, Inc., 539 35
U.S. 52 (2003), does not lead to a different finding. In Citizen’s Bank, the Court stated,

16 Moreover, as the Respondent asserts, employees who have filed class and/or collective lawsuits
have not been disciplined, much less been terminated.
17 Of course, there would be a clause stating that any disputes over this policy would be subject to
arbitration.
18 Many of the Supreme Court Justices, for example, believe the FAA was stretched too far when the
Court determined it applied to state court claims. Southland Corp. v. Keating, 465 U.S. 1 (1984), Justice
O’Connor, joined by Justice Rehnquist, dissenting; See also Allied-Bruce Terminex, supra., Justice
O’Connor concurring ; Justice Scalia dissenting; Justice Thomas, joined by Justice Scalia, dissenting.
Others believe it was stretched too far when it was held to apply to employment contracts. Circuit City,
supra, Justice Stevens, joined by Justices Ginsburg, Breyer, and Souter, dissenting; Justice Souter, joined
by Justices Stevens, Ginsburg and Breyer, dissenting.
JD(SF)–36–15
15
“Congress' Commerce Clause power ‘may be exercised in individual cases without showing any
specific effect upon interstate commerce’ if in the aggregate the economic activity in question
would represent ‘a general practice . . . subject to federal control.’” 539 U.S. at 56–57, quoting
Mandeville Island Farms, Inc. v. American Crystal Sugar Co., 334 U.S. 219, 236, (1948).
Citizens Bank and Alafabco, a fabrication and construction company, entered into debt-5
restructuring agreements that contained an agreement to arbitrate any disputes. The Court
rejected the argument that the individual transactions underlying the agreements did not, taken
alone, have a “substantial effect on interstate commerce.” Id. at 56. First, the Court found that
Alafabco engaged in interstate commerce using loans from Citizens Bank that were renegotiated
and redocumented in the debt-restructuring agreements. Second, the loans at issue were secured 10
by goods assembled out-of-state. Finally, the Court relied upon the “broad impact of commercial
lending on the national economy [and] Congress' power to regulate that activity pursuant to the
Commerce Clause.” The arbitration agreements between the Respondent and the individual
employees in this case do not fall within any of these rationales.
15
The Charging Party, pointing out that the FAA derives its authority from the Commerce
Clause, cites to National Federation of Independent Businesses v. Sebelius, 132 S.Ct. 2566
(2012). Sebelius discusses the Commerce Clause in relation to Affordable Healthcare Act’s
(ACA) provision requiring individuals to buy health insurance, commonly known as the
individual mandate. In describing the reach of the Commerce Clause in Sebelius, the Court 20
observed, “Our precedent also reflects this understanding. As expansive as our cases construing
the scope of the commerce power have been, they all have one thing in common: They uniformly
describe the power as reaching ‘activity.’” The Court determined that the “activity” at issue with
regard to the individual mandate was the purchase of healthcare insurance, and that under the
Commerce Clause, Congress was not empowered to regulate the failure to engage in this activity. 25
Under this analysis, the “activity” the MAA concerns is resolution of employment disputes. For
the reasons described above, this “activity” does not necessarily affect interstate commerce,
particularly in cases where no dispute with regard to employment under the MAA ever arises.
Based on the foregoing, I agree with the Charging Party that the Respondent has made 30
no showing that an arbitration agreement between the Respondent and any of its individual
employees affects commerce.19
4. Team truck drivers
35
The Charging Party further argues that team truck drivers who transport the Respondent’s
products across state lines are a class of workers engaged in interstate commerce, and therefore
fall within FAA’s exception at 9 U.S.C. § 1. The Court in Circuit City held that “Section 1
exempts from the FAA only contracts of employment of transportation workers.” The interstate
truck drivers are clearly transportation workers, a fact not disputed by the Respondent, and 40
therefore are exempt from the FAA. Requiring the team truck drivers to sign and adhere to the

19 As the party asserting the FAA as an affirmative defense, the Respondent has the burden of proof to
show that the agreements at issue are subject to the FAA. The assertion of the FAA as an affirmative
defense requires me to address its reach in this decision. Though, as the Respondent notes, many courts
have disagreed with the Board’s rationale in D. R. Horton, et. al., the precise issue of whether a particular
agreement to arbitrate is a “maritime transaction or a contract evidencing a transaction involving
commerce” has not been squarely addressed.
JD(SF)–36–15
16
MAA therefore violates the Act, regardless of the Board’s decisions in D. R. Horton and related
cases.
B. Enforcement of the MAA
5
Complaint paragraphs 4(e) and 5 allege that the Respondent violated Section 8(a)(1) of
the Act by enforcing the MAA, as detailed above.
It is well settled that an employer violates Section 8(a)(1) by enforcing a rule that
unlawfully restricts Section 7 rights. See, e.g., NLRB v. Washington Aluminum Co., 370 U.S. 9, 10
16-17 (1962); Republic Aviation Corp. v. NLRB, 324 U.S. 793 (1945).
Here, it is undisputed that the Respondent enforced the MAA by filing motions to compel
individual arbitration in Fardig and Ortiz, as detailed above. (Jt. Exhs. Y, Z). The Respondent
contends that the Board lacks authority to enjoin the Respondent’s motions to compel because 15
they are protected by the First Amendment under Bill Johnson’s Restaurants, Inc. v. NLRB, 461
U.S. 731, 741 (1983), and BE&K Construction CO. v. NLRB, 536 U.S. 516 (2002). I find that
instant case falls within the exception set forth in Bill Johnson’s at footnote 5, which states in
relevant part:
20
It should be kept in mind that what is involved here is an employer’s lawsuit that the
federal law would not bar except for its allegedly retaliatory motivation. We are not
dealing with a suit that is claimed to be beyond the jurisdiction of the state courts because
of federal-law preemption, or a suit that has an objective that is illegal under federal law.
Petitioner concedes that the Board may enjoin these latter types of suits. . . . Nor could it 25
be successfully argued otherwise, for we have upheld Board orders enjoining unions from
prosecuting court suits for enforcement of fines that could not lawfully be imposed under
the Act, see Granite State Joint Board, Textile Workers Union, 187 N.L.R.B. 636, 637
(1970), enforcement denied, 446 F.2d 369 (CA1 1971), rev’d, 409 U.S. 213, 93 S.Ct.
385, 34 L.Ed.2d 422 (1972); Booster Lodge No. 405, Machinists & Aerospace Workers, 30
185 N.L.R.B. 380, 383 (1970), enforced in relevant part, 148 U.S.App.D.C. 119, 459
F.2d 1143 (1972), aff’d, 412 U.S. 84, 93 S.Ct. 1961, 36 L.Ed.2d 764 (1973), and this
Court has concluded that, at the Board’s request, a District Court may enjoin enforcement
of a state-court injunction “where [the Board’s] federal power pre-empts the field.” NLRB
v. Nash-Finch Co., 404 U.S. 138, 144, 92 S.Ct. 373, 377, 30 L.Ed.2d 328 (1971).35
The Board has determined that these exceptions apply in the wake of Bill Johnson’s and
BE&K Construction. See, e.g., Allied Trades Council (Duane Reade Inc.), 342 NLRB 1010,
1013, fn. 4 (2004); Teamsters, Local 776 (Rite Aid), 305 NLRB 832, 835 (1991). Moreover,
particular litigation tactics may fall within the exception even if the entire lawsuit may not be 40
enjoined. Wright Electric, Inc., 327 NLRB 1194, 1195 (1999), enfd. 200 F.3d 1162 (8th Cir.
2000); Dilling Mechanical Contractors, 357 NLRB No. 56 (2011). As such, since the Board has
concluded that agreements such as those comprising the MAA explicitly restrict Section 7
activity, the Respondent’s attempt to enforce the MAA in state court by moving to compel
arbitration fall within the unlawful objective exception in Bill Johnson’s. See Neiman Marcus 45
Group, supra.
JD(SF)–36–15
17
The Respondent argues that numerous courts have found agreements such as the MAA to
be lawful and enforceable. While this is true, the Board has held that agreements such as the
MAA violate the Act, and the Supreme Court has not ruled otherwise. The Respondent, by its
actions in court, is challenging Board case law which very clearly holds the MAA violates the
Act. The motion to compel arbitration, which by virtue of the MAA can only be on an individual 5
basis, is the crux of the challenge. Inherent in this challenge are risks, which the Respondent is
assuming by declining to follow the Board’s case law as it works its way through the system.
C. The MAA and Board Charges
10
Complaint paragraphs 4(b) and 5 allege that the Respondent violated Section 8(a)(1) by
maintaining, at all material times since at least April 28, 2014, which would reasonably be read
by employees to prohibit them from filing unfair labor practice charges with the Board.
The Lutheran Heritage test set forth above applies to this allegation. I find that 15
employees would reasonably construe the MAA as restricting their access to file charges with the
Board.
The MAA is worded very broadly, and explicitly states it applies to “any dispute,
demand, claim, controversy, cause of action, or suit (collectively referred to as "Dispute") that 20
Employee may have” at any time that that “in any way arises out of, involves, or relates to
Employee's employment” with the Respondent. This would certainly encompass an unfair labor
practice charge with the Board.
More specifically, the MAA includes disputes involving:25
wrongful termination, wages, compensation, work hours, . . . sexual harassment,
harassment and/or discrimination based on any class protected by federal, state or
municipal law, and all Disputes involving interference and/or retaliation relating to
workers' compensation, family or medical leave, health and safety, harassment, 30
discrimination, and/or the opposition of harassment or discrimination, and/or any other
employment-related Dispute.
Certainly, disputes about wrongful termination, wages, compensation, and hours could comprise
unfair labor practice claims. Discrimination based on Section 7 activity also is encompassed by 35
this language.
The MAA then proceeds to state it applies to disputes under various federal laws, ending
with a catchall that it applies to disputes under :
40
all other federal, state, and municipal statutes, regulations, codes, ordinances, common
laws, or public policies that regulate, govern, cover, or relate to equal employment,
wrongful termination, wages, compensation, work hours, invasion of privacy, false
imprisonment, assault, battery, malicious prosecution, defamation, negligence, personal
injury, pain and suffering, emotional distress, loss of consortium, breach of fiduciary 45
duty, sexual harassment, harassment and/or discrimination based on any class protected
by federal, state or municipal law, or interference and/or retaliation involving workers'
JD(SF)–36–15
18
compensation, family or medical leave, health and safety, harassment, discrimination, or
the opposition of harassment or discrimination, and any other employment-related
Dispute in tort or contract.
That this would encompass some claims under the NLRA requires no explanation. The only 5
claims explicitly excluded are benefits under unemployment compensation laws or workers'
compensation laws.
The Respondent contends that the MAA would not be interpreted to apply to Board
charges because of the following language:10
By agreeing to arbitrate all Disputes, Employee and Company understand that they are
not giving up any substantive rights under federal, state or municipal law (including the
right to file claims with federal, state or municipal government agencies).
15
The Respondent contends that because of the explicit statement that claims with federal, state, or
municipal agencies are excluded from the MAA, any misinterpretation of the MAA would be
manifestly unreasonable. I disagree.
To begin with, the MAA specifically states claims of sexual harassment, harassment 20
and/or discrimination based on any class protected by federal law are subject to mandatory
individual arbitration. These are all patently clear examples of claims that arise under the civil
rights statutes the Equal Employment Opportunity Commission (EEOC) enforces, i.e., Title VII
of the Civil Rights Act of 1964, the Americans with Disabilities Act, and the Age Discrimination
in Employment Act.20 Yet the MAA also states that nothing would preclude an employee from 25
filing a charge with a federal agency, ostensibly including the EEOC.21 The only way to
reconcile these two provisions is to read the MAA as not precluding filing a charge with an
administrative agency, yet in the end those disputes must be resolved only through final and
binding arbitration under the MAA rather than through whatever fruits filing a charge or other
similar effort may bear. The same rationale holds true for Board proceedings, given that the 30
MAA requires individual arbitration of disputes over “wrongful termination, wages,
compensation, work hours.” This begs the question: Why would any employee bother to file a
charge? A reasonable employee, not versed in how various federal, state, and local agencies
process claims, would take it at face value that the topics specifically included as falling within
the MAA would be subject to arbitration. This is particularly true given that the MAA explicitly 35
excludes benefits under unemployment compensation laws or workers' compensation laws, but
not under the NLRA.
Considering that ambiguities must be construed against the drafter of the MAA, which is
the Respondent, I find the MAA violates Section 8(a)(1) because employees would reasonably 40
believe the MAA requires arbitration of employment-related claims covered by the Act. See
Aroostook County Regional Ophthalmology Center, 317 NLRB 218 (1995).

20 These statutes are respectively codified at 42 U.S.C. 2000e et seq.; 42 U.S.C. 121-1 et seq; and 20
U.S.C. 633a.
21 The EEOC’s charge-filing process is described at http://eeoc.gov/employees/howtofile.cfm.
JD(SF)–36–15
19
IV. CONCLUSIONS OF LAW
(1) The Respondent, Hobby Lobby Stores, Inc., is an employer within the meaning of
Section 2(6) and (7) of the Act.
5
(2) The Respondent violated Section 8(a)(1) of the Act by maintaining and enforcing a
mandatory arbitration agreement (MAA) requiring all employment-related disputes to be
submitted to individual binding arbitration.
(3) The Respondent violated Section 8(a)(1) of the Act when it enforced the MAA by 10
asserting the MAA in litigation the Charging Party brought against the Respondent.
(4) The Respondent violated Section 8(a)(1) of the Act by maintaining a mandatory
arbitration agreement that employees reasonably would believe bars or restricts their right to file
charges with the National Labor Relations Board.15
REMEDY
Having found that the Respondent has engaged in certain unfair labor practices, I shall 20
order it to cease and desist therefrom and to take certain affirmative action designed to effectuate
the policies of the Act.
As I have concluded that the MAA is unlawful, the recommended order requires that the
Respondent revise or rescind it in all of its forms to make clear to employees that the arbitration 25
agreement does not constitute a waiver of their right to maintain employment-related joint, class,
or collective actions in all forums, and that it does not restrict employees' right to file charges
with the National Labor Relations Board. The Respondent shall notify all current and former
employees who were required to sign the mandatory arbitration agreement in any form that it has
been rescinded or revised and, if revised, provide them a copy of the revised agreement. 30
Because the Respondent utilized the MAA on a corporatewide basis, the Respondent shall post a
notice at all locations where the MAA, or any portion of it requiring all employment-related
disputes to be submitted to individual binding arbitration, was in effect. See, e.g., U-Haul Co. of
California, supra, fn. 2 (2006); D. R. Horton, supra, slip op. at 17; Murphy Oil, supra.
35
I recommend the Respondent be required to notify the U.S. District Court for the Eastern
District of California in Ortiz v. Hobby Lobby Stores, Inc., 2:13-cv-01619-TLN-DAD (E.D.
Cal.), and the U.S. District Court for the Central District of California in Fardig v. Hobby Lobby
Stores, Inc., 8:14-cv-00561-JVSAN (C.D. Cal.), that it has rescinded or revised the mandatory
arbitration agreements upon which it based its motion to dismiss these actions and to compel 40
individual arbitration of the claims, and inform the court that it no longer opposes the actions on
the basis of the arbitration agreement.
I recommend the Company be required to reimburse employees for any litigation and
related expenses, with interest, to date and in the future, directly related to the Company’s filing 45
its motion to compel arbitrations in Ortiz v. Hobby Lobby Stores, Inc., 2:13-cv-01619-TLN-DAD
(E.D. Cal.), and Fardig v. Hobby Lobby Stores, Inc., 8:14-cv-00561-JVSAN (C.D. Cal.).
JD(SF)–36–15
20
Determining the applicable rate of interest on the reimbursement will be as outlined in New
Horizons, 283 NLRB 1173 (1987), (adopting the Internal Revenue Service rate for
underpayment of Federal taxes). Interest on all amounts due to the employees shall be computed
on a daily basis as prescribed in Kentucky River Medical Center, 356 NLRB No. 8 (2010).
5
On these findings of fact and conclusions of law and on the entire record, I issue the
following recommended22
ORDER
10
The Respondent, Hobby Lobby Stores, Inc., Oklahoma City, Oklahoma, with a place of
business in Sacramento, California, its officers, agents, successors, and assigns, shall
1. Cease and desist from
15
(a) Maintaining a mandatory arbitration agreement that employees reasonably would
believe bars or restricts the right to file charges with the National Labor Relations Board.
(b) Maintaining and/or enforcing a mandatory arbitration agreement that requires
employees, as a condition of employment, to waive the right to maintain class or collective 20
actions in all forums, whether arbitral or judicial.
(c) In any like or related manner interfering with, restraining, or coercing employees
in the exercise of the rights guaranteed to them by Section 7 of the Act.
25
2. Take the following affirmative action necessary to effectuate the policies of the Act.
(a) Rescind the mandatory arbitration agreement in all of its forms, or revise it in all
of its forms to make clear to employees that the arbitration agreement does not constitute a
waiver of their right to maintain employment-related joint, class, or collective actions in all 30
forums, and that it does not restrict employees' right to file charges with the National Labor
Relations Board.
(b) Notify all current and former employees who were required to sign the mandatory
arbitration agreement in any form that it has been rescinded or revised and, if revised, provide 35
them a copy of the revised agreement.
(c) Notify the U.S. District Court for the Eastern District of California in Ortiz v.
Hobby Lobby Stores, Inc., 2:13-cv-01619-TLN-DAD (E.D. Cal.), and the U.S. District Court for
the Central District of California in Fardig v. Hobby Lobby Stores, Inc., 8:14-cv-00561-JVSAN 40
(C.D. Cal.), that it has rescinded or revised the mandatory arbitration agreement upon which it
based its motions to dismiss the class and collective actions and to compel individual arbitration

22 If no exceptions are filed as provided by Sec. 102.46 of the Board’s Rules and Regulations, the
findings, conclusions, and recommended Order shall, as provided in Sec. 102.48 of the Rules, be adopted
by the Board and all objections to them shall be deemed waived for all purposes.
JD(SF)–36–15
21
of the employees’ claim, and inform the respective courts that it no longer opposes the actions on
the basis of the arbitration agreement.
(d) In the manner set forth in this decision, reimburse the plaintiffs who filed suit in
Ortiz v. Hobby Lobby Stores, Inc., 2:13-cv-01619-TLN-DAD (E.D. Cal.), and Fardig v. Hobby 5
Lobby Stores, Inc., 8:14-cv-00561-JVSAN (C.D. Cal.), for any reasonable attorneys' fees and
litigation expenses that she may have incurred in opposing the Respondent's motion to dismiss
the wage claim and compel individual arbitration.
(e) Within 14 days after service by the Region, post at all facilities in California the 10
attached notice marked “Appendix A,” and at all other facilities employing covered employees,
copies of the attached notice marked “Appendix B.”23 Copies of the notice, on forms provided by
the Regional Director for Region 31, after being signed by the Respondent’s authorized
representative, shall be posted by the Respondent and maintained for 60 consecutive days in
conspicuous places including all places where notices to employees are customarily posted. In 15
addition to physical posting of paper notices, the notices shall be distributed electronically, such
as by email, posting on an intranet or an internet site, and/or other electronic means, if the
Respondent customarily communicates with its employees by such means. Reasonable steps
shall be taken by the Respondent to ensure that the notices are not altered, defaced, or covered by
any other material. In the event that, during the pendency of these proceedings, the Respondent 20
has gone out of business or closed the facility involved in these proceedings, the Respondent
shall duplicate and mail, at its own expense, a copy of the notice to all current employees and
former employees employed by the Respondent at any time since April 28, 2014.
(f) Within 21 days after service by the Region, file with the Regional Director a 25
sworn certification of a responsible official on a form provided by the Region attesting to the
steps that the Respondent has taken to comply.
Dated, Washington, D.C. September 8, 201530
Eleanor Laws
Administrative Law Judge35

23 If this Order is enforced by a judgment of a United States court of appeals, the words in the notice
reading “Posted by Order of the National Labor Relations Board” shall read “Posted Pursuant to a
Judgment of the United States Court of Appeals Enforcing an Order of the National Labor Relations
Board.”
APPENDIX A
NOTICE TO EMPLOYEES
Posted by Order of the
National Labor Relations Board
An Agency of the United States Government
The National Labor Relations Board has found that we violated Federal labor law and has
ordered us to post and obey this notice.
FEDERAL LAW GIVES YOU THE RIGHT TO
Form, join, or assist a union
Choose representatives to bargain with us on your behalf
Act together with other employees for your benefit and protection
Choose not to engage in any of these protected activities.
WE WILL NOT maintain a mandatory arbitration agreement that our employees reasonably
would believe bars or restricts their right to file charges with the National Labor Relations Board.
WE WILL NOT maintain and/or enforce a mandatory arbitration agreement that requires our
employees, as a condition of employment, to waive the right to maintain class or collective
actions in all forums, whether arbitral or judicial.
WE WILL NOT in any like or related manner interfere with, restrain, or coerce our employees
in the exercise of the rights listed above.
WE WILL rescind the mandatory arbitration agreement in all of its forms, or revise it in all of its
forms to make clear that the arbitration agreement does not constitute a waiver of your right to
maintain employment-related joint, class, or collective actions in all forums, and that it does not
restrict your right to file charges with the National Labor Relations Board.
WE WILL notify all current and former employees who were required to sign the mandatory
arbitration agreement in all of its forms that the arbitration agreement has been rescinded or
revised and, if revised, we will provide them a copy of the revised agreement.
WE WILL notify the courts in which the employees filed their claims in Ortiz v. Hobby Lobby
Stores, Inc., 2:13-cv-01619-TLN-DAD (E.D. Cal.), and Fardig v. Hobby Lobby Stores, Inc.,
8:14-cv-00561-JVSAN (C.D. Cal.), that we have rescinded or revised the mandatory arbitration
agreement upon which we based our motion to dismiss her collective wage claim and compel
individual arbitration, and we will inform the court that we no longer oppose the employees’
claims on the basis of that agreement.
WE WILL reimburse the plaintiffs in Ortiz v. Hobby Lobby Stores, Inc., 2:13-cv-01619-TLN-
DAD (E.D. Cal.), and Fardig v. Hobby Lobby Stores, Inc., 8:14-cv-00561-JVSAN (C.D. Cal.),
for any reasonable attorneys' fees and litigation expenses that she may have incurred in opposing
our motion to dismiss her collective wage claim and compel individual arbitration.
HOBBY LOBBY STORES, INC.
(Employer)
Dated: By:
(Representative) (Title)
The National Labor Relations Board is an independent Federal agency created in 1935 to enforce the National Labor
Relations Act. It conducts secret-ballot elections to determine whether employees want union representation and it
investigates and remedies unfair labor practices by employers and unions. To find out more about your rights under
the Act and how to file a charge or election petition, you may speak confidentially to any agent with the Board’s
Regional Office set forth below. You may also obtain information from the Board’s website: www.nlrb.gov.
901 Market Street, Suite 400, San Francisco, CA 94103-1735
(415) 356-5130, Hours: 8:30 a.m. to 5 p.m.
The Administrative Law Judge’s decision can be found at www.nlrb.gov/case/20-CA-139745 or by using the
QR code below. Alternatively, you can obtain a copy of the decision from the Executive Secretary, National
Labor Relations Board, 1099 14th Street, N.W., Washington, D.C. 20570, or by calling (202) 273-1940.
THIS IS AN OFFICIAL NOTICE AND MUST NOT BE DEFACED BY ANYONE
THIS NOTICE MUST REMAIN POSTED FOR 60 CONSECUTIVE DAYS FROM THE DATE OF POSTING AND MUST NOT BE
ALTERED, DEFACED, OR COVERED BY ANY OTHER MATERIAL. ANY QUESTIONS CONCERNING THIS NOTICE OR
COMPLIANCE WITH ITS PROVISIONS MAY BE DIRECTED TO THE ABOVE REGIONAL OFFICE’S
COMPLIANCE OFFICER, (415) 356-5183.
APPENDIX B
NOTICE TO EMPLOYEES
Posted by Order of the
National Labor Relations Board
An Agency of the United States Government
The National Labor Relations Board has found that we violated Federal labor law and has
ordered us to post and obey this notice.
FEDERAL LAW GIVES YOU THE RIGHT TO
Form, join, or assist a union
Choose representatives to bargain with us on your behalf
Act together with other employees for your benefit and protection
Choose not to engage in any of these protected activities.
WE WILL NOT maintain a mandatory arbitration agreement that our employees reasonably
would believe bars or restricts their right to file charges with the National Labor Relations Board.
WE WILL NOT maintain and/or enforce a mandatory arbitration agreement that requires our
employees, as a condition of employment, to waive the right to maintain class or collective
actions in all forums, whether arbitral or judicial.
WE WILL NOT in any like or related manner interfere with, restrain, or coerce our employees
in the exercise of the rights listed above.
WE WILL rescind the mandatory arbitration agreement in all of its forms, or revise it in all of
its forms to make clear that the arbitration agreement does not constitute a waiver of your right to
maintain employment-related joint, class, or collective actions in all forums, and that it does not
restrict your right to file charges with the National Labor Relations Board.
WE WILL notify all current and former employees who were required to sign the mandatory
arbitration agreement in all of its forms that the arbitration agreement has been rescinded or
revised and, if revised, we will provide them a copy of the revised agreement.
HOBBY LOBBY STORES, INC.
(Employer)
Dated: By:
(Representative) (Title)
The National Labor Relations Board is an independent Federal agency created in 1935 to enforce the National Labor
Relations Act. It conducts secret-ballot elections to determine whether employees want union representation and it
investigates and remedies unfair labor practices by employers and unions. To find out more about your rights under
the Act and how to file a charge or election petition, you may speak confidentially to any agent with the Board’s
Regional Office set forth below. You may also obtain information from the Board’s website: www.nlrb.gov.
901 Market Street, Suite 400, San Francisco, CA 94103-1735
(415) 356-5130, Hours: 8:30 a.m. to 5 p.m.
The Administrative Law Judge’s decision can be found at www.nlrb.gov/case/20-CA-139745 or by using the
QR code below. Alternatively, you can obtain a copy of the decision from the Executive Secretary, National
Labor Relations Board, 1099 14th Street, N.W., Washington, D.C. 20570, or by calling (202) 273-1940.
THIS IS AN OFFICIAL NOTICE AND MUST NOT BE DEFACED BY ANYONE
THIS NOTICE MUST REMAIN POSTED FOR 60 CONSECUTIVE DAYS FROM THE DATE OF POSTING AND MUST NOT BE
ALTERED, DEFACED, OR COVERED BY ANY OTHER MATERIAL. ANY QUESTIONS CONCERNING THIS NOTICE OR
COMPLIANCE WITH ITS PROVISIONS MAY BE DIRECTED TO THE ABOVE REGIONAL OFFICE’S
COMPLIANCE OFFICER, (415) 356-5183.