In one of our recent employment discrimination cases, the defendant moved to dismiss our client’s claims from court because she was required to sign on to an arbitration provision when she began her employment. We succeeded in stopping arbitration in that case, but not all employees will be so lucky. More and more, employers are trying to keep their employees from vindicating their rights in court by forcing them to sign arbitration agreements.
Arbitration is a form of legal dispute resolution that is separate from the courts. Parties with legal disputes can (and are sometimes forced to) have their disputes decided by a third-party, called an arbitrator. The arbitrator is not a judge, but has the authority to make a binding decision on the parties’ dispute, which in most instances will be nearly impossible to have overturned later.
Arbitration is usually less favorable than the courts for an employee with an employment discrimination case. At the outset, there is no right to a jury and the process is not public like a lawsuit. Employees who want public vindication by a jury of their peers are out of luck. Instead, the dispute is decided solely by the arbitrator, who makes money from being selected by the parties to decide disputes. Since many companies will need an arbitrator’s services again in the future, but few employees will, it is generally believed that arbitrators can have an unconscious bias in favor of corporations and against employees. In sum, employees forced to arbitrate win less often, and recover less money when they win. That is, of course, why employers fight so hard to force employees into arbitration.
Whether an employee is required to arbitrate depends on a lot of things. Unfortunately for employees, the law surrounding arbitration generally favors corporations. In most cases, companies can even require employees to sign away their right to file in court in order to keep their jobs. Therefore, employees who have the option should strongly consider not signing an arbitration agreement. Many employees will not have that option.
If you have been forced to sign an arbitration agreement, that does not mean you are necessarily out of luck. Your agreement might not be enforceable, and if it is, you might still be able to prevail before an arbitrator. Because every case is so different, you need to consult with an attorney who knows employment law in order to pick your best course of action.