Can Your Employer Make You Sign an Arbitration Agreement?


Simply put, yes. Thanks to at-will employment, your employer can rescind an employment offer or fire you if you refuse to sign an arbitration agreement. Still, you may be able to negotiate the terms of the arbitration agreement to make it more favorable to you.

Unfortunately, many employees sign arbitration agreements without realizing it, which is why you should always read through start paperwork carefully – and consult an attorney with any questions you may have.

What Is an Arbitration Agreement?

An arbitration agreement is a legal document you sign to waive your constitutional right to a trial by jury. If you sign an arbitration agreement, you are agreeing to handle any dispute that would usually be handled in court with an arbitrator instead.

While arbitration may be easier than courtroom trials, they also leave employees at a disadvantage. Not only are workers required to waive their constitutional right, but arbitrators are usually less sympathetic towards employees than juries, who tend to favor “the little guy.” Additionally, arbitration does not allow for appeals, and often, employers get to choose the arbitrator.

Arbitration can also limit what information you have access to and what kind of awards are available.

If an arbitration agreement is not a condition of your employment, do not sign it, and even if you must sign, do not sign without negotiating.

How to Negotiate an Arbitration Agreement

You can negotiate an arbitration agreement the same way you would a salary or benefits. An employment lawyer can help you make the agreement as fair as possible.

Some strategies that can help protect you include:

  • Specifying who chooses the arbitrator
  • Making sure the arbitration adheres to the same discovery and deposition rules as a civil trial
  • Requiring your employer to cover the full cost of arbitration
  • Making sure you can access all legal remedies (including punitive damages and damages for emotional distress)
  • Remaining your right to be represented by an attorney during the arbitration process

If your employer agrees to some or all of these terms, your arbitration agreement will be more favorable for you. You can also document your objections to an arbitration agreement or cross out the arbitration clause in any agreements or documents you sign. Ultimately, your employer will have the last word, but employers often sign onto revised arbitration agreements, especially when they are interested in an employee, or the employee is in high demand.

Can the Government Still Get Involved?

Yes. Arbitration agreements do not interfere with your right to complain to government agencies. If a federal agency like the Equal Employment Opportunity Commission (EEOC) decides to sue your employer on your behalf, your arbitration agreement does not apply. Although you cannot sue for discrimination under an arbitration agreement, the EEOC has every right to pursue legal action against your employer.

Further, some states have banned arbitration agreements for sexual harassment claims, and legislation at the federal level seeks to prohibit pre-employment arbitration contracts to restore power to workers.

Get Help with Arbitration Agreements

Whether you want to negotiate an arbitration agreement before signing, or you need a lawyer to walk you through the arbitration process, look no further than Donati Law, PLLC. We have been handling a wide range of legal issues since 1980, and we are ready to help you, too.

Call us at (901) 209-5500 or contact us online to get started today.

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To discuss your case with an accomplished attorney who cares, give our firm a call at (901) 209-5500 or fill out the form below.

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