Ask any business that has been involved in a lawsuit. It is expensive, requires substantial time and resources, and can create terrible working morale.
Add to that the potential for class-action lawsuits, and businesses could be forced to close from the weight of defense fees and settlement amounts.
Good news! Lawsuits involving your employees in state and federal courts, including class action lawsuits, can be avoided through the use of arbitration agreements and class action waivers.
In a landmark 2018 decision, the U.S. Supreme Court held that class action waivers in arbitration agreements are fully enforceable. This was a complete reversal of California law and a welcome win for employers and businesses.
However, if arbitration agreements with class action waivers are properly implemented, employers can avoid the expense and disruption of court-based lawsuits and class-wide litigation by resolving disputes individually through binding arbitration.
Arbitration works much like a court proceeding, but it has substantial benefits:
- Lower costs
- Greater efficiency and speed
- The ability to choose expert adjudicators to resolve specialized disputes
Still, employers who want to utilize arbitration agreements should seek legal advice in the preparation of its arbitration agreements and class action waiver provisions.
They are not uniformly enforced but will depend on how those provisions are drafted.
Get yours done and get it done right!