Enforceability of Arbitration Agreements: New Guidance Added to Employment Law Manual

Author: Michael C. Jacobson, Legal Editor

A federal district court recently held that an employer's arbitration agreement was unenforceable because it was found in the employee handbook, which could be unilaterally altered by the employer without the employees' approval. The court ruled that employers should keep their arbitration agreements separate and distinct from employee handbooks, to enable employees to renew their agreement to arbitrate employment claims any time the agreement is modified by the employer.

This is good guidance for all employers throughout the country that use arbitration agreements to reduce their exposure to litigation.

The federal Arbitration section of the Employment Law Manual has been updated to reflect this decision.