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Arbitration Under Duress
The use of mandatory arbitration provisions in employment contracts has grown in recent years as employers seek to avoid what is perceived as 'time-consuming' and 'costly' litigation in state or federal courts. Of course, whether or not arbitration actually saves time or money is an issue open for debate. One only has to receive the pre-hearing invoice from three panelists at $500 per hour to question the latter benefit.
The Federal Arbitration Act ('FAA') seeks to ensure the validity and enforcement of arbitration agreements in any 'maritime transaction or a contract evidencing a transaction involving commerce.' 9 U.S.C. ' 1 (2000). This has been held to apply to the employer/employee relationships, paving the way for arbitration agreements to be used to settle disputes between employers and employees. A recent case illustrates what can happen when the employee cries 'foul' and says that her employer forced her to sign the arbitration agreement.
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