Arbitration agreements are unfair and undermine employee rights, and because of that, employers embrace them. But a recent Maryland federal court has slowed down the rush in enforcing unreasonable, employer-mandated arbitration agreements.
In Brent v. Priority 1 Automotive Case #: PWG-14- 1705, the Maryland federal court refused to enforce an arbitration agreement because the employer gave nothing of value to the employee in exchange for duty to arbitrate. The court held that continued employment is not enough to support a contract to arbitrate.
Further, the court noted that the employer was too clever for his own good in stating in the arbitration agreement that either side “may request” that an employment dispute be arbitrated. In fact, it did not require arbitration.
Another problem was that the employer’s employee handbook, while referring to arbitration for disputes, also stated that the employer could “enforce, change, abolish or modify existing policies.” Therefore, because the employer could change what it wanted to, whenever it wanted to, and the employee had no such right, the court found the arbitration requirement unenforceable because the employer did not create a binding obligation on itself.
This blog will keep you posted on developments in so-called mandatory arbitration. In the meantime, if you have any related questions, contact Lebau & Neuworth at (410) 296-3030 or lebauneuworth.com/contact-us.
