Absent express language, Court has jurisdiction to determine class arbitration availability

In Opalinski v. Robert Half International, Inc. (2014 WL 3733685), the Third Circuit addressed preliminary jurisdiction in determining the availability of class arbitration under the Federal Arbitration Act (9 U.S.C. §1). The plaintiffs alleged that RHI violated wage and classification laws of the Fair Labor Standards Act. The employee’s agreements with RHI included arbitration clauses but did not mention class arbitration. RHI compelled individual arbitration and the court granted the decision of class arbitration to the arbitrator. The arbitrator held class arbitration available and granted a partial award. RHI appealed to the third circuit after the court denied their motion to vacate the award. Here, however, the court addressed the district court granting jurisdiction to the arbitrator on class arbitration. The focus of the appeal was whether the court or arbitrator has jurisdiction to decide the availability of class arbitration. The court first had to determine whether the particular issue is a “question of arbitrability.” If it is, a presumption exists that the court has jurisdiction, and if not the arbitrator does.

A “question of arbitrability” asks whether the parties are bound by the particular arbitration clause, or whether the clause applies to the particular controversy. The Third Circuit joined the Sixth in holding class arbitration availability a “question of arbitrability.” The court reasoned because of the fundamental differences between bilateral and class arbitration, and the different consequences of proceeding with either, the question is a substantive gateway question that the court decides.

The arbitrability question can be overcome in express language in the agreement, but the parties failed to address it. The court reversed the arbitrators ruling and remanded to the court to determine whether the agreements called for class arbitration.