Employers often implement binding arbitration policies as a way to avoid litigating claims in court. Many employers prefer arbitration because it can be confidential, less costly, and consume significantly less time than a trial. A recent decision from the New Jersey Appellate Division highlights how one word can make or break the enforceability of such policies.
It’s no secret that employment litigation is one of the fastest growing areas of litigation – and expense – for employers. From June 2014 through June 2015, there were 12,258 lawsuits filed in United States District Courts across the county alleging violations of civil rights in employment. During that same period, also in United State District Courts, there were another 19,047 lawsuits initiated alleging violations of various U.S. labor labors, such as the federal wage and hour statute and the family leave act. And these numbers do not include lawsuits filed in state courts. How is a private business supposed to plan for the costs of the inevitable disgruntled employee who wants to sue you? One way to manage costs is by using employment arbitration agreements.