Thursday, March 13, 2008

Disadvantages of Mandatory Arbitration

Mandatory arbitration has its purposes and advantages. But in an employment dispute? I don’t think so. It has more disadvantages than it does good on the part of the employee.
First, since arbitration requires confidentiality, the public will have no access to the records. How can we know of the irregularities conducted by an employer? Isn’t this important on the part of other employees or to aspiring job applicants?
I strongly believe that unlawful employment conducts should not be kept restricted from the public. They have the right to know which employers they can trust and which ones they can’t.
Another drawback of arbitration in employment dispute is that it often always mean lower compensation for the poor employees who could have had received a higher amount in case they proceeded to litigation. Most of the time, it is the employer who gets a favorable result in arbitration.
Confidential binding arbitration prevents employees in going to court and waives their right to a trial by jury. This means that if an employee got into any dispute or controversy along with a co-employee, officer, agent, or any member of the company, they will have to resolve the dispute with an arbitrator who will decide for them.
If mandatory, any dispute associated with unlawful discharge, compensation, benefits, discrimination, wage and hour claims, harassment, any employment actions, and others should be settled through arbitration. This policy can be stated as part of an employment handbook, as part of an agreement between the employer and employee, as a separate policy or in a letter.
The enforcement to arbitrate employee rights is a highly contested issue. To assure fair arbitration agreements, there are basic requirements set forth by court.
  • Agreement should provide the plaintiff every substantive rights and remedies presented by the statute in question and the arbitral procedures have to be just.
    • Clear notice to the employee that he or she is relinquishing the right to deliver judgment discrimination claims in a court discussion and choosing instead to arbitrate these claims.
    • A neutral arbitrator.
    • A fair arbitral hearing.
  • The right to representation by a lawyer
  • Reasonable discovery
If employees are subject to mandatory arbitration when facing a dispute, they should see to it that their rights are preserved and protected through the help of a lawyer.