IBM Arbitration Gag Rules Are Illegal, Fired Workers Say

(Bloomberg) -- International Business Machines Corp.’s confidentiality rules about arbitration violate federal workplace law, two former employees alleged in labor board complaints.

In Wednesday filings with the National Labor Relations Board, ex-employees Jeffrey Rodriguez and Steve Apana wrote that IBM’s “forced arbitration” policy includes a broad secrecy requirement that violates the National Labor Relations Act, which protects employees’ right to communicate with each other about workplace issues and organize to address them. Their complaints also accused the company of “engaging in oppressive and threatening tactics in litigation and arbitration” and “enforcement efforts intended to suppress” legally-protected activism.

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Rodriguez and Apana are among hundreds of workers currently in arbitration proceedings over their claims that IBM illegally fired them as part of a scheme to replace older employees with younger ones. IBM has denied wrongdoing and said that it “makes decisions based on the needs of its business units, not age.” The company didn’t immediately respond to an inquiry about the new labor board filings.

In a 2018 ruling, a Republican-appointed U.S. Supreme Court majority ruled that U.S. labor law doesn’t prevent companies from requiring that employees bring claims in individual arbitration hearings rather than courtroom class actions. But the new NLRB general counsel appointed by President Joe Biden, Jennifer Abruzzo, signaled in an August memo that she’s interested in challenging the legality of companies’ confidentiality rules, including those restricting disclosure of evidence or outcomes from arbitration hearings.

Shannon Liss-Riordan, a lawyer for the ex-employees, said IBM uses the confidentiality requirement to block workers from sharing information as they pursue complaints against the company.

“It had many workers sign an arbitration agreement which would require them to pursue their claims in individual arbitration,” she said. “Once they get to individual arbitration it tries to block them from cooperating with one another in order to help build their cases.” 

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