Businesses Favored in Arbitration – Employees At Short End of Stick
Somewhere in that stack of paperwork you are presented with by a new employer, may lurk an arbitration agreement. Many employees are asked to sign an arbitration agreement, in which they give up the right to sue in court for employment-related issues such as wrongful termination, breach of contract and discrimination. Instead of filing a lawsuit, employees must settle any disputes with an employer through an arbitration process.
Arbitration seems to be a sensible way to resolve employment disputes. After all, many employees cannot readily imagine a time when they will be at odds with their employer and, on the outside chance problems do arise, arbitration seems to offer an alternative to protracted, expensive and public court battles. Arbitration conjures a more personalized setting where an unbiased arbitrator will hear all sides and render a fair judgement.
Unfortunately, the arbitration process can be anything but fair at times. A recent New York Times article revealed case after case of abuses by arbitration attorneys ruling in favor of businesses. For them, companies represent repeat business, whereas the wrongfully terminated plaintiff, for example, comes along once. If they rule against a company in an employment dispute, it may result in the the loss of a lucrative client. With the exception of cases that may be given teeth by a separate EEOC suit, employees who have signed away their rights to go to court may find themselves at the mercy of a biased arbitrator and, as insult to injury, may get stuck with the bill for the rendering of services.
This naturally begs the question, “Do I have to sign an employee arbitration agreement”? If your employer asks you to sign one, you can refuse, but that may put your job in jeopardy. Usually, an employer can rescind an employment offer if a prospective employee refuses to sign the arbitration agreement. If you are asked as an existing employee, an employer can also fire an at-will employee who refuses to sign.
It really can boil down to how motivated the company is to hire or retain you. If you are a valued employee, you may be able to refuse to sign an arbitration agreement or at least negotiate an agreement that is fair to you. It is advisable at this stage to consult with an attorney for help in negotiating the fairest agreement possible.
To facilitate a fair arbitration process, provisions such as choice of arbitrator, full disclosure of a potential arbitrator’s business interests, requiring all arbitration costs be paid by the employer, preserving the same legal remedies available to you if you had filed in court, and the right to have an attorney represent you throughout the arbitration process are the nuts and bolts necessary to protect yourself.
Whether you are in a position to bargain or not, the best advice is to read employment documents carefully before signing so that you will know where you stand if problems arise. If you have an employment law issue involving employment discrimination, wage and hour disputes, wrongful termination, or retaliation claims, contact the Law Offices of Stoltze & Updegraff PLC for help. We provide experienced guidance and strong advocacy for employees engaged in employment disputes over various issues and take pride in getting results for our clients.
Sources: New York Times, “In Arbitration, a ‘Privatization of the Justice System’” by JESSICA SILVER-GREENBERG and MICHAEL CORKERY, November 1, 2015. & Nolo.com, “Signing an Arbitration Agreement With Your Employer”, accessed November 2, 2015.
