### IN THE UNITED STATES COURT OF APPEALS FOR THE FIFTH CIRCUIT

No. 16

- 60029

LOGISTICARE SOLUTIONS, INCORPORATED,
Petitioner Cross

- Respondent ,

v. NATIONAL LABOR RELATIONS BOARD, Respondent Cross

- Petitioner

.

On Petition for Review and Cross

- Application for Enforcement of an Order of the

National Labor Relations Board

Before HIGGINBOTHAM, ELROD, and HIGGINSON, Circuit Judges

. JENNIF ER WALKER ELROD, Circuit Judge: LogistiCare Solutions, Incorporated , requires its employees and applicants for employment to sign a clas s or collective action waiver by which the employee or applicant waive s any right to be a representative for, or member of, a class or collective action lawsuit against LogistiC are. A n Administrative Law Judge and a three

- member panel of the National Labor Relations Board concluded that the waiver violate s Section 8(a) (1) of the National Labor Relations Act

. Because we conclude , under our binding precedent , that the waiver does not violate Section 8 (a) (1) explicitly , and because we conclude th at the waiver cannot otherwise be reasonably United States Court of Appeals Fifth Circuit 

### FILED August 9, 2017 Lyle W. Cayce Clerk Case: 16-60029 Document: 00514108599 Page: 1 Date Filed: 08/09/2017No. 16

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2 understood to violate the Act , we GRANT LogistiCare’ s petition for review and DENY the Board’s cross

- petition for enforcement. I. LogistiCare requires its employees and applicants for employment to sign a “Class Action and Collective Action Waiver” in order to be eligible for employment. The w aiver provides: Class Acti on and Collective Action Waiver Class and Collective action lawsuits have been abused recently by trial l awyers forcing American Companies to pay large settlements, not because the cases have merit or because the Company violated any laws, but because the suits are too expensive to litigate and the company is left with no reasonable alternative. Class and Col lective action suits primarily benefit the trial lawyers and rarely accomplish any other objective. There are more effective ways to protect your individual employment related rights than through a Class or Collective action law suit . Your signature on thi s document indicates that you agree to waive any right you may have to be a member of a Class or Collective action lawsuit or a representative of a Class or Collective action lawsuit against the Company. I hereby acknowledge and understand that as a condi tion of my employment: [1] I am waiving my right to have a trial by jury to resolve any lawsuit related to my application or employment with the Company; [2] I am waiving my right to participate as a member of a Class or Collective action lawsuit and/or se rve as a class representative of similarly situated employees in any lawsuit agains t the company. 1 One applicant who signed the w aiver brought an unfair

- labor

- practice charge with the National Labor Relations Board . T he Board in turn brought a complaint al leging that LogistiCare violated Section 8(a)(1) of the National Labor Relations Act , 2 9 U.S.C. § 158(a)(1) (NLRA or Act), by requiring employees and applicants to sign the w aiver. In particular, the Board alleged

1 The LogistiCare Employee Manual contains an abbreviated version of the w aiver. Case: 16-60029 Document: 00514108599 Page: 2 Date Filed: 08/09/2017No. 16

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3 that : (1) the w aiver’s prohibition on engaging in class or collective litigation violate s Section 8(a) (1) of the NLRA by infringing rights protected by Section 7 of the Act ; and (2) the w aiver independently violates Section 8(a) (1) because employees w ould reasonably inte rpret the w aiver to restrict their right to file charges with the Board

. The dispute was first heard by an Administrative Law Judge, who accepted both of the Board’s grounds for finding a Section 8(a)(1) violation. In a two

- to

- one decision, a three

- member panel of the Board affirmed the ALJ’s order. The Board first concluded that Section 7 of the Act guarantees employees the right to participate in class or collectiv e actions. I n so doing, it distinguished our decisions in D.R. Horton, Inc. v. NLRB , 737 F.3 d 344 (5th Cir. 2013) and Murphy Oil USA, Inc. v. NLRB , 808 F.3d 1013 (5th Cir. 2015) because the waivers in those cases were contained with in arbitration agreements, which are governed by the Federal Arbitration Act, 9 U.S.C. § 1, et seq . Rather than rely ing on these cases, the Board looked to its own decision in Convergys Corp oration , et al. , 363 NLRB No. 51 (2015)

. 2 The Board next concluded that the w aiver is “independently unlawful” because “employees would reasonably read the rule as restricting their right to file unfair labor practice charges with the Board .” Member Miscimarra dissented on both issues. Having found two Section 8(a)(1) violations, t he Board ordered LogistiCare to cease and d esist from the unlawful conduct and to take steps to notify all applicants and current employees that the w aiver was no longer

2 The petition for review from the Board’s order in that case was resolved by our decision in Convergys Corp oration v. NLRB , No.15

- 60860 (5th Cir. Aug. 7 , 2017). Case: 16-60029 Document: 00514108599 Page: 3 Date Filed: 08/09/2017No. 16

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4 enforceable. LogistiCare petitioned for review of t he Board’s order and the Board cros s - petitioned for enforcement. 3 II
. We review the Board’ s factual findings under a substantial evidence standard. F lex Frac Logistics, L.L.C. v. NLRB , 746 F.3d 205, 207 (5th Cir. 2014) (quoting Sara Lee Bakery Grp., Inc. v. NLRB , 514 F.3d 422, 428 (5th Cir. 2008)). Substantial evidence is such relevant evidence “sufficient for a reasonable mind to accept as adequate to support [ the ] conclusion”; it is “more than a mere scintilla and less than a preponderance.” Id

. ( alteration omitted). While we review t he Board’s legal conclusions de novo , we will “enforce the Board’s order if its construction of the statute is reasonably defensible.” Murphy Oil , 808 F.3d at 1017; Patt ern Makers’ League of N. Am., A F L

- CIO v. NLRB , 473 U.S. 95, 114 (1985 ). III. Section 8(a) (1) of the NLRA provides that “[i]t shall be an unfair labor practice for an employer

. . . to interfere with, restrain, or coerce employees in the exercise of the rights guaranteed in [Section 7 ] .” 29 U.S.C. § 158(a) (1)

. Section 7 of the Act provides , in relevant part, that employees “shall have the right to self

- organization, 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

. . . .” 29 U.S.C. § 157

. Determining whether an employer’s action infringes a Section 7 right

— and therefore violates Section 8(a)(1)

— requires a two

- step inquiry. Fi rst, we

3 LogistiCare also requires applicants and employees to sign a jury

- trial waiver. Though the NLRB alleged that this waiver violates the Act , the ALJ rejected this argument and th at decision was affirmed. Case: 16-60029 Document: 00514108599 Page: 4 Date Filed: 08/09/2017No. 16

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5 must determine “ whether the [employer’s conduct ] explicitly restricts acti vities protected by Section 7. ” Flex Frac , 746 F.3d at 208

– 09 (emphasis omitted)

. Second, even if the employer’s action does not “explicitly” infringe on a Section 7 right, it still violates Section 8(a)(1 ) if , as relevant here, “employees would reasonably construe the language to prohibit Section 7 activity[.]” Id . at 209; see also D.R. Horton , 737 F.3d at 363 (“[A] company nonetheless violates section 8(a)(1) if employees would reasonably construe the lan guage to prohibit section 7 activity.”); Murphy Oil , 808 F.3d at 1019 (same). A. The Board first determined that the w aiver violates Section 8(a) (1) “explicitly

. ” In particular, it concluded that an employee’s right under Section 7 “ to engage in other concerted activities” includes participation in class or collective action litigation, and so the w aiver’s prohibition of this activity “interfere[s]” with this right in violation of Section 8(a) (1)

. See 29 U.S.C. § 158(a)(1)

. We addres sed this precise issue in Convergys Corp oration v. NLRB , No. 15

- 60860 ( 5th Cir. Aug. 7 , 2017) . In that case, we held that our binding decision in D. R. Horton hold s that Section 7 does not confer a substantive right to participate in class or collective action litigation and therefore forecloses the Board’s argument. Convergys , No.15

- 60860, s lip o p. at 3

– 8

. Because we are bound by our decision in D.R. Horton , we hold that the Board erred in concluding that the w aiver violates Section 8(a) (1) explicitly. B. The Board also determined that the waiver independently violate s Section 8(a)(1) because employees would reasonably interpret the waiver to restrict their right to file charges with the Board. We have held that language that does not violate Section 8( a) (1) explicitly m ight still do so if “employee s would reasonably construe the language to prohibit Section 7 activity.” Flex Case: 16-60029 Document: 00514108599 Page: 5 Date Filed: 08/09/2017No. 16

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6 Frac , 746 F.3d at 209

. In undertaking this inquiry, “we may not presume that a workplace rule impermissibly interferes with employ ees’ right to exercise their Section 7 right s , ” id

. ; nor is it “enough that [the language] merely co uld possibly be read that way.” NLRB v. Arkema, Inc. , 710 F.3d 308, 318 (5th Cir. 2013)

. Rather, it must actually “be reasonable for employees to interpret the [ language ] to prohibit Section 7 activities.” Id

. And in making this determination, “we ‘must refrain from reading particular phrases in isolation.’” Flex Frac , 746 F.3d at 209 (quoting Lutheran Heritage Village

- Livonia , 343 NLRB 646, 646 (2004))

. In this case , the Board determined that the waiver is “independently unlawful” because “employees would reasonably read the rule as restricting their right to file unfair labor charges with the Board.” LogistiCare agrees that Section 7 confers a right to file charges with the Board, but it contends that the w aiver cannot reasonably be understood to infringe this right. I n D.R. Horton and Murph y Oil , we considered whether certain class and collective action waivers would be reasonably understood to prohibit br inging charges to the Board. D .R. Horton involved an arbitration agreement by which the employees “ waive [d] all rights to trial in court before a judge or jury on all claims between them ” and a greed that “ all disputes and claims” would “be determined exclu sively by final and binding arbitration

. ” 737 F.3d at 348. Affirming the Board, we held that the agreement could be reasonably interpreted to prohibit employees from filing unfair labor practice claims with the Board. Id . at 36 3

– 6 4. In particular, we reaso ned that while the agreement used the terms “court,” “trial,” “jury , ” and “lawsuit,” these references were “insufficient” because the agreement also referred “to court actions in one sentenc e and agency actions in another ” and provided that employees waive d their “right to file a lawsuit or other civil proceeding .” Id . at 364 (emphasis Case: 16-60029 Document: 00514108599 Page: 6 Date Filed: 08/09/2017No. 16

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7 added)

. Read as a whole, the agreement could be reasonably understood to preclude filing charges with the Board. Id . at 363

– 64. Likewise , in Murphy Oil , an arbitration agreement provided that “any and all disputes or claims,” must be resolved by individual arbitration and that employees “waiv[ed] their right to be a party to any group, class or collective action claim in any ot her forum.” 808 F.3d at 1019 (alteration omitted)

. Again, we determined that the “broad ‘any claims’ language” could create the reasonable impression that an employee was waiving his or her administrative rights. Id .; see also Chesapeake Energy Corp. v. NLRB , 633 F. App’x 613, 614

– 15 (5th Cir. 2016) (agreement providing that employees “must pursue any claims

. . . solely on an individual basis through arbitrat ion” violated Section 8(a)(1))

. As LogistiCare argues, t he w aiver’s language in this case is far less expansive than the provis ions in D.R. Horton and Murphy Oil

. It refers to “trial lawyers , ” “ trial by jury, ” and “lawsuits.” 4 It does not contain generic references to “claims” or “disputes ” as did the provision s in Murphy Oil and D.R. Horton

. Cf

. Murphy Oil , 808 F.3d at 1019; D.R. Horton , 737 F.3d at 348. Nor does the waiver reference an “agency,” “other civil proceeding,” or anything else that would suggest that it is intended to prohibit employees from bringing charges to the Board. Cf

. D.R. Horton , 737 F.3d at 36 3

– 6 4. The absenc e of suc h capacious language in LogistiC are’s waiver strongly suggests that a reasonable layperson would not construe the w aiver’s references to “lawsuits” or “suits” to preclude bringing charges to the Board. 5

4 The abbreviated version of the w aiver contained in the employee handbook also refers to “jury trials,” “judge,” and “lawsuits.”

5 These same considerations distinguish this case from Cellular Sales of Mo., LLC v. NLRB , 824 F.3d 772, 774

– 75, 777

– 78 (8th Cir. 2016) (holding that an arbitration agreement providing that “[a]ll claims, disputes or controversies

. . . shall be decided by [individual] Case: 16-60029 Document: 00514108599 Page: 7 Date Filed: 08/09/2017No. 16

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8 The Board has asserted a host of reasons for why the w aiver violates Section 8(a)(1), but none of them are convincing. First, the Board points us to two of its own decisions : U

- Haul Co. of California, et al. , 347 NLRB 375 (2006) and Utility Vault Co., A Div. of Oldcastle Precast, Inc. & Wholesale Delivery Drivers, Salespersons, Indus. & Allied Workers, Local 848 Int’ l Bhd. of Teamsters , 345 NLRB 79 (2005). In U

- Haul , the Board held unlawful an arbitration provision despite a disclaimer that the “arbitration process is limited to disput es, claims or controversies that a court of law would be authorized to entertain

. . . . ” 347 NLRB at 377 (emphasis added). And in Utility Vault , the Board found unlawful an agreement providing that certain specified claims “shall not be filed or pursued i n court , and that [the employee was] forever giving up the right to have those claims decided by a jury .” Utility Vault , 345 NLRB at 81 ( some emphasis omitted )

. N either of these Board decisions are on point

. While the reference to “court of law” in U

- Haul is similar to the w aiver’s reference to “lawsuit,” the U

- Haul language did not appear in the actual employee agreement, but was contained in a separate memo announcing the policy

. U

- Haul , 347 NLRB at 377. The Board concluded that there was no indica tion in the memo that its reference to “court of law” was intended to limit the terms of the separate employee agreement. Id . at 377. No such problem besets the LogistiC are

w aiver. Likewise, in Utility Vault , the Board ’s decision relied heavily on the fact that the agreement at issue explicitly exempted certain types of claims from its scope , but did not specifically exempt charges to the Board. 6 345 NLRB

arbitration” violated Section 8(a)(1) given its “breadth an d generality” and “ the absence of any limits to this broadly worded provision”).

6 Specifically, the agreement excluded: (1) claims for worker’s compensation benefits; (2) claims fo r unemployment compensation benefits; and (3) claims subject to a union contract. See Utility Vault , 345 NLRB at 81. Case: 16-60029 Document: 00514108599 Page: 8 Date Filed: 08/09/2017No. 16

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9 at 81. According to the Board, a reasonable employee could infer from the
expr ess exclusion of certain claims that all other claims, including Board charges, were subject to the agreement. Id

. at 82. T he w aiver in this case does not raise a similar problem. 7 The Board next argues that a reasonable employee could construe the

w aiver as prohibiting Board cha rges because lay people in prior cases have referred to actions before the Board as “lawsuits” or “suits.” This anecdotal evidence has little probative value. While a layperson may well use the term “lawsuits” or “suits ” loosely in conversation , it does n ot follow that a reasonable lay person would impute that colloquial meaning to a technical document that would not use these term s in an informal sense
. In any event, the w aiver does not refer to “lawsuits” in isolation, but includes references to “trial lawyers,” and “ trial by jury”

— phrases typically associated with proceedings in a court of law. See Flex Frac , 746 F.3d at 209 (“ [W] e must refrain from reading particular phrases in isolation.” ). T he Board counters with the fact that administrative and ju dicial proceedings have a common nomenclature ( e.g. , judge, case, witness, etc.) and that both involve trials and lawyers. But t his argument is self

- defeating

. A ny layperson having sufficient familiarity with Board proceedings and judicial proceedings to k now that they share a common vocabulary would surely

— as a result of that knowledge

— also be aware that actions before the Board are not , properly speaking, “ lawsuits. ” And even if not, we would be hard

- pressed to characterize such a mistaken equivalence as “reasonable.”

7 In any event, we are not bound by the Board’s decisions. See Pioneer Nat. Gas Co. v. NLRB , 662 F.2d 408, 411 (5th Cir. 1981) (“ [W] e are not bound by the Board’s conclusion that the Act has been violated.”). Case: 16-60029 Document: 00514108599 Page: 9 Date Filed: 08/09/2017No. 16

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10 Finally, the Board argues that because Board charges “may eventually end up in court” a reasonable layperson could interpret a class or collective action waiver to prohibit bringing charges to the Board

. See U

- Haul , 347 NLRB at 377

– 78 ( conclu ding that “inasmuch as decisions of the National Labor Relations Board can be appealed to a United States court of appeals, the reference to a ‘court of law’ does nothing to clarify that the arbitration policy does not extend to the filing o f unfair labor practice charges ” ). Taken to its logical conclusion, this argument would invalidate every collective action waiver that does not contain an explicit statement indicating that it does not preclude bringing charges to the Board. After all, a bsent such an exp ress statement, a lay person (or the Board) could always point to the fact that Board charges may be appealed to the courts of appeals, regardless of how clear the provision might otherwise be. We have never required such an express statement and, in fact, have previously declined to do so. See Murphy Oil , 808 F.3d at 1019 (“We do not hold that an express statement must be made that an employee’s right to file Board charges remains intact before an employment arbitration agreement is lawful.”). We see no reason to change course here. 8 IV. Accordingly, we GRANT in full LogistiC are’s petition for review and DENY in full the Board’s cross - petition for enforcement.

8 The Board also argues that a reasonable lay person could interpret the w aiver to prohibit filing charges with the Board because the waiver’s heading does not use the term “lawsuit” or “trial.” We reject this argument. To discern the meaning of a writing

— and the range of reasonable meanings a layperson might ascribe to it

— we must assess the writing as a whole. See Flex Frac , 746 F.3d at 209 (“ [W] e must refrain from reading particular ph rases in isolation.”). W hile the waiver’s heading does not refer to “lawsuits” or “trials,” the body of the waiver does. T he se references to “lawsuit,” “trial lawyers,” and “trial by jury” in the body of the wavier obviate any ambiguity that might arise fr om the ir absence in the waiver’s heading. Case: 16-60029 Document: 00514108599 Page: 10 Date Filed: 08/09/2017No. 16

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11 PATRICK E. HIGGINBOTHAM, Circuit Judge, concurring in part; dissenting in part: As in Convergys Corporation v. NLRB , 1 this case concerns whether a company’s class and collective action waiver violates Section 8(a)(1) of the Nat ional Labor Relations Act ( “the Act”), 29 U.S.C. §§ 151, et seq

. For the

reasons stated in my dissent in Convergys , I would hold that a bare class and collective acti on waiver outside of an arbitration agreement violates the Act. On this issue, I dissent from the majority opinion. However, I agree with the majority’s analysis and conclusion that the waiver does not violate § 8(a)(1) for the independent reason that emp loyees could reasonably interpret it to restrict their right to bring charges with the Board. On this issue, I concur in the majority opinion.

1 No.15

- 60860 (5th Cir. Aug. 7 , 2017). Case: 16-60029 Document: 00514108599 Page: 11 Date Filed: 08/09/2017No. 16

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12 STEPHEN A. HIGGINSON, Circuit Judge, concurring in Section III(A) ; dissenting as to Section III(B) : I would uphold the Board’s determination that an employee could reasonably interpret the language of LogistiCare’s waiver to restrict the employee’s right to bring unfair labor practice charges with the Board

. We must read the agreement from the p osition of non

- la wyer employees, not judges, remembering that “[r] ank

- and

- file employees do not generally carry lawbooks to work or apply legal analysis to company rules as do lawyers, and cannot be expected to have the expertise to examine company rules from a legal standpoint. ” Ingram Book Co

. , 315 N

. L

. R

. B

. 515, 518 n.2 (1994) . With this in mind, I disagree with LogistiCa re ’s claim that because the waiver includes the words “lawsuit” and “trial lawyers , ” “ any reader would necessarily understand” that the waiver relates only to judicial , and not administrative, proceedings. T he Board observes that it is not uncommon for emp loyees to refer to Board proceedings as “lawsuits ” and notes that “ administrative proceedings share with their judicial counterparts an entire nomenclature, including terms like judge, case, trial, attorney, lawyer, witness, subpoena, and testimony.” Thus, when an employee signs LogistiC are’s agreemen t banning all “C las s and C ollective action lawsuit [s] ,” I agree with the Board that “[ t]he reasonable impression could be created that [the] employee is waiving not just .

. . trial rights, but . . . administrative rights as well.” D.R. Horton, Inc. v. N.L.R.B. , 737 F.3d 344, 363 (5th Cir. 2013)

. Because I believe the Board’s finding that the agreement could be misconstrued was reasonable, I would enforce its order requiring L ogistiCare to take corrective action. See i d . at 364

. I agree with the majority that our recent decision in Convergys Corporation v. N

. L

. R

. B

. , No. 15

- 60860, forecloses the Board’s alternative argument that LogistiCare’s waiver violates Section 8(a)(1) by r equiring Case: 16-60029 Document: 00514108599 Page: 12 Date Filed: 08/09/2017No. 16

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13 employees to waive the ability to participate in class or collective action litigation. I view this position as irreconcilable with this court’s precedent. See D.R. Horton, 737 F.3d at 361

. Nonetheless, as I explained in my concurring opinion in Convergys

— and as Judge Higginbotham explained in his dissenting opinion

— I believe the better view is that a right to class and collective action falls within Section 7’s scope

. See also Patterson v. Raymours Furniture Co. , 659 F. App’x 40, 43 (2d Cir. 2016 ), as corrected (Sept. 7, 2016), as corrected (Sept. 14, 2016) (unpublished) (summary order); Lewis v. Epic Sys. Corp. , 823 F.3d 1147 (7th Cir. 2016), cert. granted , 137 S. Ct. 809 (2017) ; Morris v. Ernst & Young, LLP , 834 F.3d 975 (9th Cir. 2016), cert. g ranted , 137 S. Ct. 809 (2017)

. Acco rdingly, I concur in part and dissent in part

. Case: 16-60029 Document: 00514108599 Page: 13 Date Filed: 08/09/2017