Must arbitration agreements be initialed by employer and employee? — Business Management Daily: Free Reports on Human Resources, Employment Law, Office Management, Office Communication, Office Technology and Small Business Tax Business Management Daily

Must arbitration agreements be initialed by employer and employee?

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Q. My company implemented an employment arbitration program several years ago, applicable to employees in all states, including Georgia. I recently have been told that Georgia law has special employment arbitration rules requiring that both the employer and the employee initial arbitration agreements in order to be enforceable. Is this true? We don’t do this.

You’re referring to a provision of the Georgia Arbitration Code (GAC). In most instances, the Federal Arbitration Act (FAA) preempts this provision. The FAA contains no initialing requirement.

As a general rule, whether your employer’s arbitration program is governed by the GAC or the FAA depends on whether the company’s employment relationship with its Georgia employees involves or affects interstate commerce in any way. If it does—and most do—then the FAA applies and the company’s noncompliance with the GAC is inconsequential.

Note one exception to this general rule: If the employees in question are transportation workers engaged in transporting goods in interstate or foreign commerce, then the FAA is inapplicable and compliance with the GAC is required.

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