The National Labor Relations Board, or NLRB, filed an official complaint June 30 against WeWork — a $16 billion startup with an office in Berkeley that provides communal working spaces — regarding the legality of an arbitration agreement waiving employees’ right to file lawsuits against employers.
The complaint is the result of the dismissal of Tara Zoumer, a Bay Area WeWork employee who was terminated after refusing to sign an arbitration clause — an agreement to bring any legal claims against an employer to arbitration rather than filing a lawsuit in court. The NLRB, an independent government agency that investigates unlawful labor practices, is scheduled to present its case in front of an administrative law judge Sept. 7 in Oakland.
“This complaint has no merit,” said Jennifer Barden, a spokesperson for WeWork, in an email. “Our employees are our lifeblood, and we firmly believe our policies are lawful and fair.”
Zoumer was employed at WeWork as an associate community manager from March to November of last year, during which time she raised concerns about potentially unlawful labor practices, including a lack of overtime and the meal breaks. WeWork disagreed with her claims and then circulated a new arbitration agreement to all employees.
Zoumer was dismissed shortly after she refused to sign the new arbitration agreement. The company says it had cause to terminate Zoumer because she signed an arbitration agreement as a part of her offer letter when she accepted the position at WeWork in November.
Arbitration agreements, although controversial, are standard practice so internal matters are resolved within the company. But the NLRB considers them — especially agreements that waive the right to class action claims — a violation of the National Labor Relations Act, although there have been conflicting rulings in the courts.
“We contend that WeWork was motivated to terminate her more by her complaints regarding working conditions than anything else,” said Ramsey Hanafi, Zoumer’s attorney.
Hanafi added that Zoumer refused to sign the arbitration agreement given to her in March because it would waive Zoumer’s right to file a class action claim against WeWork regarding the company’s working conditions.
David Rosenfeld, a campus lecturer specializing in labor law, said the NLRB has emphasized protecting employees from employers that attempt to stymie workers from getting together to improve working conditions.
“You can’t fire somebody because they refuse to abide by an illegal rule,” Rosenfeld said. “Many individuals have gone to the labor board and said that they were retaliated against for doing so and so.”
If the administrative law judge rules in the NLRB’s favor in September, WeWork can appeal the decision to the NLRB board.
A previous version of this article misattributed information to a WeWork attorney.
A previous version of this article incorrectly stated that WeWork had cause to terminate Zoumer because she signed an initial arbitration agreement when she first accepted a position at WeWork. In fact, WeWork had cause to terminate Zoumer for refusing to sign a new arbitration agreement.