Pros And Cons Of Mandatory Terroration Agreements

Employers have a broad scope of what issues they may cover in a mandatory arbitration agreement. This broad scope was first established by the Supreme Court when it held that claims under the Age Discrimination in Employment Act (ADEA) could be subject to mandatory arbitration. See Gilmer v. Interstate/Johnson Lane Corp., 500 U.S. 20, 111 S. Ct. 1647, 114 L. Ed. 2d 26 (1991). Following the ruling in Gilmer, most courts have held that other federal statutes, including the Americans with Disabilities Act (ADA), the Family and Medical Leave Act (FMLA), and Title VII of the Civil Rights Act of 1964 (Title VII), are subject to mandatory arbitration as well. The mandatory arbitration agreement would be upheld in most courts so long as proper safeguards

This is one of the biggest points of contention for mandatory arbitration agreements within employment law. This contention arises from the public policy concern that employees will be forced to agree to the arbitration procedure or seek employment elsewhere. In a society where employment acts as a sense of identity, and arbitration agreements are an industry standard amongst a majority of employers, public policy argues that employees lack the bargaining power to deny these agreements. Many point to the vast amount of rights lost by employees when they agree to such a procedure, e.g., trial by jury, discovery procedures, judicial review, etc. Sadly, a mere disparity in bargaining power does not constitute unconscionability in most cases. See, e.g., Gilmer v. Interstate/Johnson; and Great Western Mortg. Corp. v. Peacock, 110 F.3d 222 (3d Cir. 1997). In fact, some courts will not even address the issue of unconscionability when a mandatory arbitration agreement exists; instead of stating that unconscionability is an issue that must be, paradoxically, handled in arbitration. See, e.g., Rojas v. TK Communications, Inc., 87 F.3d 745 (5th Cir.