Arbitration Policies

Does anyone have an arbitration policy that I can review? We are adding this to our Employee Handbook and I would like some help with the wording of it before having our attorney go over it.

Thank you.
[email]Lisa@amberwoodproducts.com[/email]
408-938-1606 fax

Comments

  • 6 Comments sorted by Votes Date Added
  • Our legal counsel recommended that the arbitration policy be separate from the handbook. How many times have you had an employee breaking a policy, claiming they read the handbook, but don't remember that portion? We handed out our policy separate from the handbook and required them to sign an acknowledgement form.
  • Thank you for the information I was anticipating doing it separately. Having read some of the law letters regarding enforceable arbitrations policies.
  • Employer programs to resolve workplace disputes through arbitration are terrific, and I think most employers would benefit from adopting them. However, it is important to take the time to think it through before you implement such a program. You want to be sure to get it right the first time.

    Creating an agreement to arbitrate is simple--the Federal Arbitration Act requires only a written agreement to arbitrate. Arbitration clauses in contracts are often only a line or two. However, you want to make sure that you will be able to enforce the agreement you enter into, and that it will provide what you are looking for. Decide what rules are going to apply (yours, AAA's, or someone else's), the source from which the arbitrator will be selected, who will be responsible for costs, etc. AAA rules impose some restrictions and disadvantages that you may not be willing to accept. Creating your own rules has benefits, but takes an investment of some time. There are other rules available, from alternative ADR providers. Your decisions on these and other issues will have an impact on the cost of the program, how effective it is in comparison with litigation, the speed with which cases are handled, and potentially on your ability to enforce the program. If these issues aren't considered before implementing the program, you may have an agreement that doesn't accomplish your objectives, or one that creates an agreement which you might have difficulty enforcing. I urge you to work with counsel experienced in the development, implementation and enforcement of arbitration agreements. I'm drafting an article on this topic for the July issue of the Virginia Employment Law Letter, and will be happy to see that you get a copy if you wish.

    David E. Nagle
    Editor, Virginia Employment Law Letter
    [email]dnagle@leclairryan.com[/email]

  • I would very much like to receive a copy of the article. Would it be consistant with California laws?
  • As is so often the case, Calirfornia law is consistent only with the law of Oz.

    There is much case law that needs to be taken into consideration in developing a program to be used in California, most notably the Cal. Sup. Court decision in Armandariz. The decision that came down yesterday from the 9th Circuit, in Ingle v. Circuit City, is also significant. That 9th Circuit decision illustrates the danger of including unenforceable provisions. The 9th Circuit described a part of Circuit City's program as "manifestly and shockingly one-sided" and found that the arbitration agreement "functions as a thumb on Circuit City's side of the scale." The Court found numerous provisions unconscionable and the entire contract unenforceable.

    Well-crafted and implemented agreements to arbitrate are still enforced in California--it is just harder there than elsewhere. I was able to get an order compelling arbitration of discrimination claims in case filed in state court in San Fransisco just a couple of months ago.

    I would be happy to see that you get a copy of the article. There will be caveats unique to California, but if you work with counsel experienced in arbitration issues, you can overcome the hurdles.

  • Thank you for the information. I agree working in California is like "Oz" but, more like the HBO show rather than Wizard of Oz. There are sooooo many new laws and changes it is impossible to keep up with them then once you THINK you have it down it changes again. I wish I had a good witch of the west to help.

    Ok, back to the real world. I am getting some legal counsel on adding an arbitration policy currently. Hopefully it will work out.
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