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Why you need to worry about that arbitration clause in your employment contract

If you are subject to an employment contract here in San Diego, then you’re likely aware of how that agreement has terms and conditions. 

What you may not be aware of is how the agreement may contain a clause dictating that you must first pursue arbitration, not litigation, to resolve any disputes that arise with your employer. You may find it helpful to understand what arbitration entails so you’ll know what to expect should you need to pursue this alternative dispute resolution (ADR) option. 

What does forced arbitration entail?

Arbitrators can be either retired judges or specially-trained lawyers. They’re non-biased parties responsible for ultimately coming up with a legally binding solution when a dispute arises.

Many employers require their employees to pursue arbitration to keep the details and settlements of their operations private since arbitration occurs behind closed doors. Employers also pursue this option because it’s legally binding and protects their reputation.

How often do employees win at arbitration?

Employees subject to arbitration agreements commonly ask what their prospects of success are at the negotiation table. Attorneys often advise their clients not to get their hopes up. They often warn their clients of this because there are different burdens of proof, evidentiary, due process and statutes of limitations that apply to arbitration cases from litigated ones. 

Economic Policy Institute (EPI) data shows that in 2015, employees only won 19.1% of forced arbitration cases. Employees succeed in 36.4% of federal and 57% of state-litigated ones. 

Fighting for your rights in your employment case

While the odds may seem like they’re stacked against you if you’re subject to a forced arbitration agreement, that’s not necessarily the case. You do have the right to argue your case. An attorney can help you craft a solid argument in your dispute with your employer in hopes of you winning it. 


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