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Ensure arbitration agreements are clear, fair

by on
in Discrimination and Harassment,Human Resources

Given their druthers, courts would just as soon rule that employment arbitration agreements are valid—and send them back for an arbitrator to settle. But employers must help by making those agreements easily understood, fair and not entirely one-sided.

If employers push too hard or weigh down agreements in layers of legal jargon, courts may be tempted to declare them invalid.

Recent case: Raenee Alexander worked for Professional Exchange Service as a manager. One day, she got sick at work and was sent home. When she returned, her boss said she needed a doctor’s clearance. She brought in a doctor’s note, but the super­visor told her it wasn’t clear and that she had to sign a release authorizing him to speak with her doctor about her condition.

She quit and sued, alleging a long list of discriminatory practices.

The company told the court that she had signed an arbitration agreement and demanded the case be trans­ferred to arbitration. Alexander argued the agreement was unconscionable, saying it was buried at the end of the employee handbook.

But Professional Exchange Serv­ice gave the court a photocopy showing that she had initialed re­­­ceipt of the document. The agreement was separate from the rest of the handbook and featuring bold capital letters declaring it to be an arbitration agreement. The details were spelled out in plain English and were neither confusing nor entirely one-sided. In fact, Alexander retained many of the rights she would have had in court, including the right to discovery and other procedural and legal safeguards.

That was enough for the court to send the case to arbitration. (Alexander v. Professional Ex­change Service, No. F059647, California Court of Appeal, 5th Appellate District, 2011)

Final note: Always have your lawyer review arbitration agreements.

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