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Don’t let simplest error derail arbitration: Make sure agreement was signed

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in Employment Law,Human Resources

California employers who want to bind their workers to arbitration have to jump through a number of hoops. For one thing, you need to produce an agreement signed by the employee.

Recent case: Shawn sued his former employer over alleged ADA violations. The company tried to move the case to arbitration, claiming that Shawn had signed an agreement when he was originally hired and that the agreement was prominently featured in other company documents. Therefore, the employer argued, it was a condition of Shawn’s employment.

It also argued that Shawn had signed an offer letter that said, “By signing this letter below, you also agree to abide by all [company] policies, procedures, rules and regulations currently in effect or that may be adopted from time to time.” The offer letter then explained,  “You also will be required to sign a mutual agreement to arbitrate claims.”

Indeed, the company’s usual practice was to require all employees to sign a Mutual Agreement to Arbitrate Claims.

However, when challenged, it could not produce a signed copy of the agreement, nor could the company produce a witness who observed Shawn signing or returning such a document.

Because California law places the burden on the employer to prove an employee signed the agreement, the court refused to send the case to arbitration. At most, the employer proved that Shawn knew he would be asked to sign an agreement—but not that he had, in fact, done so. (Socoloff v. LRN, No. 13-57064, 9th Cir., 2016)

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