Judge James C. Dever, III of the Eastern District of North Carolina entered an order in NLRB v. Raleigh Restaurant Concepts, Inc., Case No. 5-15-CV-438-D (Aug. 12, 2016),  enforcing a subpoena duces tecum issued by the NLRB in connection with its investigation of an unfair labor practice charge filed by an independent contractor alleging that Raleigh Restaurant Concepts unlawfully enforced a contractual waiver of the right to collectively pursue her claims in all forums, judicial and arbitral. The charge was filed by the exotic dancer after a court ordered her to arbitrate her Fair Labor Standards Act and North Carolina Wage and Hour Act claims in which she claims that she and other entertainers were misclassified as “independent contractors” as opposed to “employees.”

During the investigation of the unfair labor practice charge, the NLRB requested that Raleigh Restaurant Concepts provide “entertainer leases…and copies of all handbooks and work rules that apply to employees at Respondent’s facility.” However, Raleigh Restaurant Concepts provided only the documents that the dancer had signed, but not leases signed by other entertainers or handbooks that apply to employees. Because of the incomplete response, the NLRB issued a subpoena duces tecum for the documents.

Raleigh Restaurant Concepts filed a petition to revoke the subpoena based on three grounds:

  1. employee handbooks and work rules were not relevant because the dancers never saw those documents;
  2. the NLRB could only investigate the charge filed, not investigate potential violations of the NLRA regarding any non-charging parties; and
  3. because the NLRB is investigating a claim that enforcement of a class-action waiver violates the NLRA, the claim is meritless, and the NLRB cannot investigate meritless claims.

In rejecting Raleigh Restaurant Concepts’ arguments, the court found that the “identities of the putative victim class are reasonably relevant to the charge,” and thus the NLRB was entitled to copies of the entertainer leases. Second, the court found that the employee handbooks and policies are relevant because they “may contain evidence regarding company-wide enforcement of these policies–both as to individuals Raleigh Restaurant Concepts considers employees and as to the entertainers, who the NLRB may ultimately classify as employees.” Finally, the court found that the NLRB had jurisdiction to investigate the allegations because the Fourth Circuit had yet to decide whether a mandatory class-action waiver in an arbitration agreement violates the NLRA and that other federal circuits had reached conflicting conclusions.