Business Conflict Blog

Prima Paint teaches that the arbitration agreement nestled in a commercial contract has a legal validity of its own, and that once a court determines that the “nestled” agreement to arbitrate is enforceable, then the arbitrator and not the court shall determine the enforceability of the rest of the contract.

The interesting thing about the arbitration agreement in Rent-a-Car, West v. Jackson is that there wasn’t anything for the arbitration agreement to nestle into.  The document evidenced only an agreement to arbitrate.  Other terms of any commercial agreement between Jackson and his employer were set forth elsewhere.  This was just a “Mutual Agreement to Arbitrate Claims.” 

So when Jackson was prompted to sue his employer for racial discrimination, the federal district court didn’t have an arbitration agreement to sever from the rest of the contract.  It had only the agreement to arbitrate itself, in all its lonely glory.

Which Jackson said was unconscionable because it was thrust upon him and unfairly limited his ability to vindicate his statutory rights.

And which provided that questions of unconscionability were to be decided by (guess who?) the arbitrator, not the court.  Take that, Prima Paint.

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Tags: Arbitration, Employment

The Supreme Court granted cert Friday in an employment arbitration case addressing whether the arbitrator or the court should determine the enforceability of an arbitration clause.  The outcome could do mischief to the FAA and to Supreme Court precedent.  Once again there is reason to lament the harm that the practice of employment arbitration is wreaking upon commercial arbitration principles. Read more »

Tags: Arbitration, Employment

 In previous posts, I expressed concern that mandatory employment arbitration is having a bad effect on the practice of arbitration generally.  As my older brother used to say, “Duh.”  And here’s some more troublesome evidence of this regrettable trend. Read more »

Tags: Arbitration, Employment

The firm of Ogletree Deakins and St. Louis University recently held an all-day Employee Dispute Resolution Symposium at the University’s very beautiful Busch Student Center.  The proceedings were well-attended and it was a privilege for me to be invited to present the opening remarks.

The comments of the various speakers, many from in-house corporate programs and some from outside attorneys, suggested that the “center” has shifted over the past few years, and that comprehensive conflict management programs that seriously address employee concerns rather than gearing up for employment arbitration are very much the norm these days. Read more »

Tags: Employment, systems design