A relative of mine is working for a New York firm that has recently had to pay after being sued for workplace harassment & retaliation. Now, they are requiring that all employees sign an agreement to go to arbitration should such suits be brought again, and those who refuse to sign this agreement will not be considered for annual pay raises.

How much of her rights would she be giving up if she chose to sign this agreement?

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    I'm not sure what you mean by "how much of her rights"...assuming it is only a mandatory arbitration clause, you're giving up exactly what it says; the right to sue without going through arbitration for the specific reasons laid out in the agreement... – Rarity Jun 10 '12 at 13:59
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    The standard advice about legal matters, which by definition includes legal documents and agreements: Consult an attorney. Have the attorney review the proposed agreement BEFORE signing it. – John R. Strohm Jun 10 '12 at 20:51
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    This question can not be answered with out seeing the actual agreement. It could be giving up more or less depending on the wording. – IDrinkandIKnowThings Jul 13 '12 at 13:54
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    So found guilty of retaiation - so they go and threaten to reataiate aginst every worker for not signing some of thier rights away. Sounds like the compnay has not learned its leason. A new HR Director and / Or CEO is required – Neuro Oct 11 '12 at 13:41
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    I was just reading some numbers about arbitration... Companies win arbitration about 95% of the time. Also, each party must split the cost of the arbiter which is quite expensive. Binding arbitration also keeps companies far away from class action suits. – user25792 Oct 13 '18 at 10:56

There are some advantages (or disadvantages, depending on the situation) for both you and the company:

  • You can choose an arbitrator that has expertise in your field of work, while judges are assigned at random and cannot be chosen.
  • The whole process is faster
  • The legal expenses are generally lower
  • Usually you cannot appeal
  • Usually the proceedings are confidential

I cannot think of a disadvantage that in general affects only you and wouldn't apply to the company. Example: if you lose and you cannot appeal that would certainly be a disadvantage; but if you win and the company cannot appeal, then it is a disadvantage for the company.

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    Mandatory arbitration might prevent class actions, e.g. if discriminated-against individuals are handled one at a time and only if they press the matter. – Monica Cellio Jun 11 '12 at 14:37
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    An important question here is who chooses the arbitrator? Does the contract specify that? If the arbitrator is biased toward the company, that's definitely a disadvantage for the employee... – weronika Jun 11 '12 at 15:46
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    If I represented the company and chose an arbitrator and the arbitrator ruled against me, I would never select that arbitrator again. If I was an arbitrator, I would know who is buttering my bread, and rule accordingly. If I was an employee, I would not expect much from the arbitrator. – emory Jun 12 '12 at 1:42
  • @emory - that's why you make sure the arbitration agreement requires that either you agree to the arbitrator or that they be selected at random. Then there is no repeat business for them to worry about. – AJ Henderson Dec 8 '14 at 21:02

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