Is Staying at Work an Agreement to Arbitrate?

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In the wake of the highly publicized United States Supreme Court decision in AT&T Mobility v. Concepcion, many managementside lawyers have urged their clients to take advantage of the decision. Specifically, they have urged employers who have arbitration agreements with their employees to add a class waiver provision to the agreement; as for their clients who do not yet have an arbitration agreement, some counsel have advised them to adopt an arbitration agreement with a class waiver provision. By way of background, Concepcion held that class action waivers are fully enforceable, but it is not yet clear whether under California law, class action waivers in wage and hour cases ultimately will be deemed enforceable. This article will not address that issue, but will focus on more practical questions: If an employer imposes a new or revised policy requiring all disputes to be arbitrated, is that policy binding on employees who don’t sign it? What if the employer’s announcement states that the new arbitration policy is mandatory, not optional, and that employees who continue in employment are deemed to have accepted it whether or not they actually sign it? Is it in fact the case that continued employment is deemed acceptance of a class waiver through the creation of an implied-in-fact contract? Would it matter if an employee actually objected to the policy, and told the company that he had no intention of arbitrating any claims?

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Published In: Alternative Dispute Resolution (ADR) Updates, General Business Updates, Labor & Employment Updates

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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