Ross Stores, Inc.

National Labor Relations Board - Administrative Judge Opinions

Oct 21, 2014

31-CA-109296 (N.L.R.B. Oct. 21, 2014)

JD(SF)–49–14
Thousand Oaks, CA
UNITED STATES OF AMERICA
BEFORE THE NATIONAL LABOR RELATIONS BOARD
DIVISION OF JUDGES
SAN FRANCISCO BRANCH
ROSS STORES, INC.
and Cases 31–CA–109296
31–CA–114107
RACHEL GOSS, an Individual
J. Carlos Gonzalez, Esq., for the General Counsel.
Gregory D. Wolflick Esq. (Wolflick & Simpson),
for the Respondent.
Matthew Righetti, Esq. (Righetti & Glugoski),
for the Charging Party.
DECISION
Statement of the Case
JAY R. POLLACK, Administrative Law Judge: This case came before me based on a
stipulated record dated July 21, 2014, whereby the parties waived a hearing. On July 16, 2013,
Rachel Goss (Goss) filed the charge in Case 31–CA–109296 against Ross Stores, Inc.
(Respondent or the Employer). On February 27, 2014, Goss filed an amended charge against
Respondent. On September 27, 2013, Goss filed the charge in Case 31–CA–114107. On
February 28, 2014, the Regional Director for Region 31 of the National Labor Relations Board
(the Board) issued a complaint against Respondent. The complaint alleges that Respondent
violated Section 8(a)(1) of the National Labor Relations Act (the Act). The Respondent filed a
timely answer in which it denied that it had violated the Act.
The parties have been afforded full opportunity to appear, and to file briefs. Upon the
entire record, and having considered the briefs submitted by the parties, I make the following:
Findings of Fact
At all times material, Respondent, a corporation with a principal place of business in
Thousand Oaks, California, has been engaged in the retail sale of clothing and related products.
Respondent, in conducting its business operations described above, during 12 months prior to the
issuance of the complaint, derived gross revenues in excess of $500,000. Respondent purchased
and received goods at its facilities in California valued in excess of $5,000 directly from sources
JD(SF)–49–14
2
outside the State of California. Accordingly, the parties stipulated and I find, Respondent is an
employer engaged in commerce within the meaning of Sections 2(2), (6), and (7) of the Act.
At all times material, Respondent, a corporation with a principal place of business in 5
Thousand Oaks, California, has been engaged in the retail sale of clothing and related products.
Respondent, in conducting its business operations described above, during 12 months prior to the
issuance of the complaint, derived gross revenues in excess of $500,000. Respondent purchased
and received goods at its facilities in California valued in excess of $5,000 directly from sources
outside the State of California. Accordingly, the parties stipulated and I find, Respondent is an 10
employer engaged in commerce within the meaning of Sections 2(2), (6), and (7) of the Act.
Specifically, the complaint alleges that Respondent interfered with, restrained, and
coerced employees in the exercise of their Section 7 activities by maintaining and enforcing
several employment policies as set forth below. Since at least May 4, 2010, and at all material 15
times, Respondent has maintained a provision titled “Arbitration Policy” in its Store Associate
Handbook.
About May 4, 2010, Respondent had Goss sign a “Store Associates Handbook
Acknowledgement and Agreement” which, when executed, required Goss to “agree to utilize, 20
comply with, and be bound to” Respondent’s Arbitration Policy described above.
Since at least August 18, 2011, Respondent has enforced its Arbitration Policy and Store
Associates Handbook Acknowledgement and Agreement described above by asserting them in
litigation brought against Respondent by Charging Party Rachel Goss in Rachel Goss, 25
individually and on behalf of all others similarly situated v. Ross Stores, Inc., Ross Dress For
Less, Inc., and Does 1 through 50, inclusive, Case RG11577328 (Class Action Complaint) tiled
in Superior Court of the State of California, County of Alameda (Superior Court).
About August 18, 2011, Respondent filed in Superior Court a motion to compel 30
individual arbitration of Goss’ claims against Respondent alleged in the Class Action Complaint
and filed the Declaration of Respondent’s Manager, Corporate Paralegal, Jeff Cook in support of
the motion to compel individual arbitration. About October 26, 2011, the Superior Court issued
an order denying Respondent’s motion to compel the Charging Party to individual arbitration.
About December 14, 2011, Respondent appealed the Superior Court’s denial of the motion to 35
compel individual arbitration.
About October 31, 2013, the Court of Appeals of the State of California, First Appellate
District, Division One, (Court of Appeals) reversed the Superior Court’s order denying
Respondent’s motion to compel individual arbitration. 40
Since at least June 13, 2011, and at all material times, Respondent has maintained a
provision titled “Dispute Resolution Agreement” requiring employees who agree to comply and
be bound to it to individually arbitrate all employment-related claims, including claims arising
under federal statutes. 45
JD(SF)–49-14
3
Since June 13, 2011, Respondent has required all current and new store employees to
review the Dispute Resolution Agreement by logging into Respondent’s electronic program with
an employee-specific password. Respondent’s electronic program is used by employees to
receive training and to acknowledge receipt of Respondent’s new policies, procedures, and
handbooks.5
After presenting employees with the terms of the Dispute Resolution Agreement, the
electronic program takes employees to an electronic signature page which prompts employees to
either accept the terms of the Dispute Resolution Agreement by clicking an “I Agree” button or
decline the terms of the Dispute Resolution Agreement by exiting the electronic program.10
Statement of the Issues
Based on the foregoing factual stipulations, the Parties agree that the legal issues to be
resolved in this matter are the following:15
(1) Whether Respondent violated Section 8(a)(1) of the Act by maintaining and enforcing
its Arbitration Policy which requires employees to resolve all employment-related disputes
through individual arbitration.
20
(2) Whether Respondent violated Section 8(a)(1) of the Act by maintaining its Dispute
Resolution Agreement which requires employees who accept to be bound by the Dispute
Resolution Agreement to resolve all employment-related disputes through individual arbitration.
Position of the Parties25
The General Counsel and Charging Party argue that the Respondent’s “Arbitration
Policy” in its Store Associate Handbook is unlawful on its face and violates Section 8(a)(1) of
the Act. In D. R. Horton, Inc., 357 NLRB No. 184 (2012), the legal framework for considering
the legality of employers’ arbitration agreements that limit collective and class legal activity in 30
judicial and arbitral forums was addressed by the Board. The Board held that a policy or
agreement precluding employees from filing employment-related collective or class claims in
both judicial and arbitral forums violates Section 8(a)(l) of the Act because this type of
agreement restricts employees’ Section 7 right to engage in concerted action for mutual aid or
protection.35
The Respondent argues Section 10(b) of the Act requires that a charge be filed within
6 months of the alleged incident giving rise to the violation of the Act. The Board does not
have jurisdiction to issue a complaint based on conduct occurring more than 6 months before the
filing and service of the charge. Media General Operations, Inc., 346 NLRB 74 (2005).40
Respondent further argues that even assuming that the 10(b) period somehow did not run
until Respondent filed its Motion to Compel Arbitration on August 8, 2011, the Charging Party
would have been required to file her charge on or before February 9, 2012. Even under this
measure, the instant charge is more than 18 months beyond the 10(b) period. As a result, the 45
Board has neither authority nor jurisdiction to issue the complaint in the instant matter.
JD(SF)–49-14
4
Additionally, Respondent argues that the Board’s continued reliance on D. R. Horton,
Inc. is inappropriate.
Conclusions
5
1. Section 10(b)
Section 10(b) of the Act requires that a charge be filed within 6 months of the alleged
incident giving rise to a violation of the Act. A complaint may not issue based upon conduct
occurring more than 6 months before the filing and service of the charge. Media General 10
Operations, Inc., 346 NLRB 74 (2005).
Here the charge was not filed until July 16, 2013. Thus, I can only consider matters after
January 16, 2013. Thus, the allegation that Goss signed the agreement to arbitrate is time barred.
The allegation that Respondent filed a court action to compel arbitration is time barred. The 15
allegation that Respondent appealed the court’s dismissal of its action to compel arbitration is
time barred. The only allegations which are not timed barred are the maintenance of the
Arbitration Agreement and the maintenance of the Dispute Resolution Agreement, since
January 16, 2013.
20
2. The Arbitration Policy
The Arbitration Policy (Policy) “applies to any disputes arising out of or relating to the
employment relationship, between an associate and Ross [. . . .] This policy requires that all such
disputes be resolved only by an Arbitrator through final and binding arbitration.”25
Further, the Policy states “The parties will have the right to conduct civil discovery and
bring motions, as provided by the Federal Rules of Civil Procedure and enforced by the
Arbitrator. However, there will be no right or authority for any dispute to be brought, heard or
arbitrated as a class action, private attorney general, or in a representative capacity on behalf of 30
any person.”
In D. R. Horton, Inc.,357 NLRB No. 184 (2012), the Board held that a policy or
agreement precluding employees from filing employment-related collective or class claims in
both judicial and arbitral forums violates Section 8(a)(1) of the Act because this type of 35
agreement restricts employees’ Section 7 right to engage in concerted action for mutual aid or
protection. It is undisputed that the Arbitration Policy prohibits class actions in both judicial and
arbitral forums. Respondent required employees to agree to the Arbitration Policy as a condition
of employment. Accordingly, I find that Respondent’s maintenance of the Arbitration Policy
violates Section 8(a)(1) of the Act as set forth in D. R. Horton, Inc., supra.40
3. The Dispute Resolution Agreement
Respondent has required employees to review the Dispute Resolution Agreement by
logging into Respondent’s electronic program. The Dispute Resolution Agreement requires45
employees who agree to comply and be bound to individually arbitrate all employment-related
claims. The Dispute Resolution Agreement “sets forth the procedures that you and Ross
mutually agree must be used to resolve disputes arising out or relate to your employment with
JD(SF)–49-14
5
Ross or its termination. Disputes subject to this Agreement will be resolved by mediation or
final and binding arbitration and not by a court or jury. ”
The Agreement further states, “In arbitration, all parties will have the right to conduct
discovery and bring motions as provided by the Federal Rules of Civil procedure. There will be, 5
however, no right or authority for any dispute to be brought or arbitrated as a class action.”
In D. R. Horton, Inc., 357 NLRB No. 184 (2012), the Board held that a policy or
agreement precluding employees from filing employment-related collective or class claims in
both judicial and arbitral forums violates Section 8(a)(1) of the Act because this type of 10
agreement restricts employees’ Section 7 right to engage in concerted action for mutual aid or
protection.
This Agreement, for employees who agree to sign it, prohibits employees from bringing
forth claims against Respondent in a concerted manner. Accordingly, I find that Respondent’s 15
maintenance of the Dispute Resolution Agreement violates Section 8(a)(1) of the Act as set forth
in D. R. Horton, Inc., supra.
Respondent argues that that the D. R. Horton, Inc. case became invalid as result of the
United States Supreme Court holding in Noel Canning v. NLRB, 134 S.Ct. 2550 (2014). 20
However, the D. R. Horton, Inc. decision was not affected by the Noel Canning decision. D. R.
Horton, Inc. was issued by a Board consisting of Chairman Mark Pearce and Board Members
Craig Becker and Brian Hayes. In Noel Canning, the Supreme Court held that the appointment
of Members Terence Flynn, Sharon Block, and Richard Griffin were unconstitutional. The
Supreme Court did not find that the appointments of Pearce, Becker, or Hayes were 25
unconstitutional. Thus, D. R. Horton, Inc. continues to be binding Board precedent.
CONCLUSIONS OF LAW
1. Respondent is an employer engaged in commerce and in a business affecting 30
commerce within the meaning of Section 2(6) and (7) of the Act.
2. Respondent violated Section 8(a)(1) of the Act by maintaining an Arbitration Agreement
which waives the right to maintain class or collective actions in all forums, whether arbitral or
judicial.35
3. Respondent violated Section 8(a)(1) of the Act by maintaining a Dispute Resolution
Agreement which waives the right to maintain class or collective actions in all forums, whether
arbitral or judicial.
40
REMEDY
Having found that the Respondent has engaged in certain unfair labor practices, I find
that it must be ordered to cease and desist and to take certain affirmative action designed to
effectuate the policies of the Act.45
JD(SF)–49-14
6
On these findings of fact and conclusions of law and on the entire record, I issue the
following recommended1
ORDER5
The Respondent, Ross Stores, Inc. in Thousand Oaks, California, its officers, agents,
successors, and assigns, shall
1. Cease and desist from10
a. Maintaining its Arbitration Agreement to the extent that Agreement prohibits
employees from filing collective or class action lawsuits or arbitrations.
b. Maintaining its Dispute Resolution Agreement to the extent that Agreement 15
prohibits employees from filing collective or class action lawsuits or arbitrations
c. In any like or related manner interfering with, restraining, or coercing employees in
the exercise of the rights guaranteed them by Section 7 of the Act.
20
2. Take the following affirmative action necessary to effectuate the policies of the Act:
a. Rescind or revise the prohibition of collective or class action lawsuits and
arbitrations from its Arbitration Agreement and Dispute Resolution Agreement.
25
b. Within 14 days after service by the Region, post at its facility in Thousand Oaks,
California, copies of the attached notice marked “Appendix.”2 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 30
posted. In 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 35
proceedings, the Respondent 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
July 16, 2013.
40

1 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.
2 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.”
JD(SF)–49-14
7
c. Within 21 days after service by the Region, file with the Regional Director a sworn
certification of a responsible official on a form provided by the Region attesting to the steps that
the Respondent has taken to comply.
5
Dated, Washington, D.C., October 21, 2014

Jay R. Pollack10
Administrative Law Judge
APPENDIX
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 prohibit you from filing collective or class action lawsuits or arbitrations in
concert with your fellow employees.
WE WILL NOT maintain and enforce our Arbitration Agreement or Dispute Resolution
Agreement to the extent that they prohibit employees from filing collective or class action
lawsuits or arbitrations.
WE WILL rescind or revise the prohibition of filing collective or class action lawsuits and
arbitrations from our Arbitration Agreement and Dispute Resolution Agreement
ROSS 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.
11500 West Olympic Boulevard, Suite 600
Los Angeles, California 90064-1824
Hours: 8:30 a.m. to 5 p.m.
310-235-7352
The Administrative Law Judge’s decision can be found at http://www.nlrb.gov/case/31-CA-109296 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.
JD(SF)–49-14
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 THISNOTICE OR COMPLIANCE WITH ITS PROVISIONS MAY BE DIRECTED TO THE ABOVE
REGIONAL OFFICE’S COMPLIANCE OFFICER, 310-235-7123.