More organizations are establishing mandatory arbitration agreements that require employees to arbitrate employment disputes rather than go to court. But if you're considering such agreements, make sure they contain language that covers events that occurred before you put the arbitration policy in place.
Why? Because if you don't, you may be encouraging employees to file federal discrimination lawsuits right away as a way of avoiding arbitrating the claim later.
Recent case: Retail worker Ora Berkley, an African-American woman, filed a race discrimination complaint with the EEOC. Two weeks later, her employer announced a new policy that required employees to arbitrate "any claim that could be made in court."
Berkley argued that her earlier EEOC complaint couldn't be forced into arbitration because the alleged discrimination took place earlier. Not so, said the court. "Any claim that could be made in court" included claims that predated the arbitration policy. (Berkeley v. Dillard's, Inc., No 05- 3523, 8th Cir., 2006)
Final note: Arbitration clauses are filled with legal traps; let an employment attorney handle the details.
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