The answer to the question of whether you may pursue a hostile workplace lawsuit in a court may depend on whether you signed an employment agreement to arbitrate. The U.S. Supreme Court recently reaffirmed its willingness to enforce employment agreements that force employees to arbitrate claims in private proceedings rather than file lawsuits through the U.S. court system. In Epic Systems Corp. v Lewis, the U.S. Supreme Court ruled that corporate employers can enforce arbitration agreements signed by employees. The Epic Court held that these arbitration agreements may waive the employee’s right to pursue certain class action employment related lawsuits in the court system.
Why might your employer try to force you to arbitrate your employment case?
One significant consequence of the Epic decision is that employers will be more likely to have employees sign “mutual” agreements to arbitrate employment related claims. Many employers prefer private arbitration over public court litigation. Employers typically prefer arbitration because they reason that arbitration: 1) will lower litigation costs; 2) will keep matters private and outside of public view and 3) employers will have a better likelihood of success in arbitration to defeat employment related claims filed by employees. The Epic decision gives employers the green light to require employees to sign “mutual” agreements to arbitrate employment claims.
These arbitration agreements are not “mutual” in the sense that the employer usually drafts such agreements with terms that are most favorable to the employer’s interests. Moreover, the arbitration agreement is not “negotiated” between the employer and new hire employee. The agreement is typically presented to the employee at the time of hire as just another document that must be signed along with other documents like basic payroll records and health insurance forms.
Another immediate consequence of the Epic decision is that employees will be less able to pursue wage loss claims against employers in the court system. As Justice Ginsberg pointed out in her dissent, violations of state and federal wage and overtime laws are more likely to go unenforced if the claimed violations cannot be pursued as class actions lawsuits. While hourly workers lose billions of dollars in wages earned but not paid each year, it will likely be cost prohibitive for an individual employee to bring his or her own individual wage loss claim to an arbitration procedure. Employees have traditionally had the ability to pursue wage loss claims as class action lawsuits in a court of law where the costs of litigation can be defrayed by many individuals.
Could the Epic Supreme Court case impact sexual harassment lawsuits?
Finally, the Epic decision may encourage corporate employers to require arbitration of other traditional employment based claims like race and gender discrimination and sexual harassment complaints. One of the most important ways to enforce federal and state rights against discrimination and harassment has been through the public court system. By forcing individual employees to abandon the court system and go to private arbitration, employees may find that they are unable to effectively secure their rights.
In addition, other coworkers who have faced similar workplace discrimination and/or harassment may remain in the dark about their coworker’s fight for justice is the case is pursued in a private arbitration proceeding. If an employee is forced to individually arbitrate discrimination/harassment claims in private arbitration, the employee may be less able to effectively redress systemic workplace abuses. There is a risk that in the private arbitration arena, victims of unlawful discrimination and hostile work places will be silenced and employers who violate the law will do so without penalty.
This is a complicated area of the law that deserves discussion that goes beyond the scope of this article. This article also does not address an individual’s right to file employment complaints with the appropriate federal and state agencies including the Equal Employment Opportunity Commission and the Michigan Department of Civil Rights.
How can the lawyers at Kalniz, Iorio and Reardon help?
If you believe that you have been the victim of wage and hour theft, workplace discrimination or harassment, hostile work environment or have questions about an employment agreement that you have signed, do not hesitate to contact the attorneys of Kalniz, Iorio & Reardon to discuss how our experienced litigators may assist you.