Employees have come to me wanting to know if an arbitration agreement they signed at work is enforceable. According to a recent ruling by a Federal Court in New Jersey, it is enforceable. N.J. Civil Justice Inst. v. Grewal, Civ. No. 19-17518. This is not good news for employment discrimination plaintiffs. New Jersey had previously amended the New Jersey Law Against Discrimination (NJLAD) to prohibit an employer from enforcing arbitration agreements that prohibit filing a lawsuit in court as condition of employment. This recent Grewal decision by a NJ Federal District Court ruled that the Federal Arbitration Act preempts the state law. In plain language this means it sets aside the NJLAD amendment, and that the Federal Arbitration Act requires the arbitration of employment claims if an employee signed an arbitration agreement and a court will enforce arbitration agreements where employees assigned away their right to a jury trial.
Employers are happy with this Federal Court ruling. Employers want to avoid litigation particularly if it proceeds to a jury trial. Plaintiffs in a discrimination lawsuit prefer litigation to arbitration since the court rules have stricter evidentiary rules than do arbitration procedures. The evidentiary rules in a lawsuit filed in court, allow for the discovery of more information helpful to a plaintiff’s claims.
More critically, this Federal Court opinion in Grewal held that a state law that avoids referring to arbitration by name does not avoid Federal Arbitration Act preemption, citing Kindred Nursing Ctrs. Ltd. P'ship v. Clark, 137 S. Ct. 1421, 1426 (2017) (citing Concepcion, 563 U.S. at 341).
It held that any state law that discriminates on its face against arbitration as well as any rule that covertly accomplishes the same objective by disfavoring contracts that have the defining features of arbitration agreements will be preempted by the FAA, citing 137 S. Ct. at 1426.
In Kindred Nursing, the Supreme Court held that although a Kentucky state law rule did not refer to arbitration by name, the Court concluded that the rule was preempted by the Federal Arbitration Act because the state court rule relied on what was the primary characteristic of an arbitration agreement, i.e., a waiver of the right to go to court and receive a jury trial.
If you signed such an arbitration agreement, there are some instances where it may not be enforceable, such as it was not clear that you were waiving your right to go to court and signing away your right to a jury trial.
Whether or not you signed an arbitration agreement, if you believe you have been discriminated against or retaliated against, or if your employer is not complying with Wage and Hour laws, you should contact this law office today for a free consultation.
What You Can Do
Whether or not you signed an arbitration agreement, if you believe you have been discriminated or retaliated against, or if your employer is not complying with Wage and Hour laws, you should contact this law office today for a free consultation. I am an aggressive and compassionate employment law attorney who is experienced in successfully representing persons who were subjected to discrimination, harassment and retaliation in the workplace and/or were fired. If you have experienced discrimination at work, or if you complained about what you believe to be your employer’s illegal acts and were retaliated against, if you are thinking of resigning, or think you will be fired, or have been fired, it is important that you consult with an attorney who is experienced in employment discrimination.
If you are being subjected to such workplace conduct, contact Hope A. Lang, Attorney at Law today for a free consultation.
Hope A. Lang, Attorney at Law serves clients throughout New Jersey, including Bergen, Middlesex, Essex, Hudson, Monmouth, Ocean, Union, Camden, Passaic, and Morris Counties with locations in southern, central, western and northern NJ to meet with clients.