Published on:

How the Omission of Essential Terms Allowed a New Jersey Employer to Escape Arbitration and Pursue Her Age Discrimination Case in Court

In this blog (as well as in other spaces discussing discrimination and sexual harassment in the workplace), one issue that recurs frequently is the arbitration agreements that employers request or demand that their employees sign. The topic comes up with frequency because they are so important — these agreements can dramatically alter an employee’s rights and greatly affect the outcome of a harassment or discrimination dispute.

These arbitration agreements often disproportionately benefit the employer because the employer will (or believes it will) achieve a more favorable overall outcome resolving the case in arbitration than in court. With that mind, it may benefit an employee to seek to get the agreement thrown out, which would allow the employee to go forward in the litigation process that she/he preferred. If you need to pursue a harassment or discrimination claim, and are seeking to get an arbitration agreement thrown out, you need to have the knowledge and skill of an experienced New Jersey discrimination attorney on your side.

There can possibly be many different ways under New Jersey law to get around an arbitration agreement. M.F.’s case was an example of one. M.F. had worked for a weight-loss and nutrition business for more than a quarter-century. 20 years into her employment, in 2011, the employer submitted to the employee an arbitration agreement, which she was required to sign to maintain her employment.

In recent years, the employer had begun cutting back M.F.’s hours. She had gone from full-time hours to just three hours per week. Then the employer terminated M.F. entirely. She was 82 years old.

M.F.’s lawsuit alleged that the employer had cut her hours and then terminated her due to age discrimination. The employer pointed to the 2011 agreement and asked the judge to send the case to arbitration. The trial judge agreed with the employer.

The employee, however, won on appeal. Her victory was the result of certain legal specifics that are contained in the law that governs these types of agreements. In the 2011 agreement, the document did not precisely state exact what forum would be the one where the dispute would be arbitrated, and it did not state what process would be used for carrying out the arbitration. Those were major omissions and fatal for the employer’s side.

As the Appellate Division court pointed out in its opinion, the agreement could have identified a specific “arbitral institution (like the American Arbitration Association (AAA) or the Judicial Arbitration and Mediation Services (JAMS)), or they could have communicated a general method for selecting a different arbitration setting.” M.F.’s. agreement, however, did none of those things. The lack of such a term in the agreement meant that the agreement was unenforceable. All contracts, including employer-employee arbitration agreements, must demonstrate that the parties had a “meeting of the minds” to be enforceable under the law. The details not included in this agreement were so significant that their absence meant that the document could not possibly represent a sufficient meeting of the minds regarding the surrender of the employee’s right to go to court.

So, in short, the agreement was missing too much by way of specific details to be entitled to be enforced, the employer wasn’t entitled to an order compelling arbitration and the employee was entitled to continue pursuing her age discrimination lawsuit in court.

If you’ve suffered sexual harassment or discrimination at work, and you signed an arbitration agreement, don’t give up. There may still be options to allow you to proceed to trial. The experienced New Jersey employment attorneys at Phillips & Associates are here to provide you with the advice you need. Our team has been helping victims of workplace harassment and discrimination for many years. Reach us online or at (609) 436-9087 today to set up a free and confidential consultation and to find out how we can help you.

More blog posts:

When the Law Does (and Does Not) Require an ‘Unmistakable’ and ‘Affirmative’ Act From You to Signal Your Assent to an Arbitration Agreement in New Jersey, New Jersey Employment Lawyer Blog, Sept. 28, 2018

Third Circuit Allows Employees to Go Forward with Age Discrimination Lawsuit Despite Employer’s Arbitration Policy, New Jersey Employment Lawyer Blog, Sept. 19, 2017

Contact Information