College professors beware, arbitration is coming to an employment contract near you! Companies love arbitration clauses which allow for disputes to be moved out of the courts and into privately arranged dispute resolutions processes. Companies love arbitration because it tends to reduce the amount of discovery (the information they have to turn over) and reduces their risk of large verdicts. (Indeed Alabama has a whole body of law based on arbitration clauses in nursing home contracts.) A recent 11th Circuit Court of Appeals decision reversed a NLRB decision involving a Florida non-profit college that had changed its employment contracts to include mandatory arbitration and waiver of class actions. When an employee refused to sign the arbitration agreement and class action waiver, she was fired.
The case decision was largely a result of the U.S. Supreme Court decision in Epic Systems (allowing employers to impose arbitration and class action waivers in employment agreements) to filter down to the 11th Circuit. In the 11th Circuit case, Everglades College, Inc. v. NLRD, a Florida non-profit college changed it’s employment policies to require employees bring employment disputes through arbitration and waived employee’s right to class actions. An employee who had failed to sign the new policies was fired and challenged her firing with the National Labor Relations Board (NLRB). The NLRB ruled in her favor, but the 11th Circuit in a short opinion based on Epic Systems, reversed.
The employee in Everglades College, Inc. v. NLRB was an existing employee who was required to “on board” to the college’s revamped employment policies. The employee missed several college imposed deadlines, ostensibly to talk to a lawyer about the changes. After several extensions the employee was fired when she failed to accept the new policies that included mandatory arbitration and class action waiver.
The case had been pending for some time. Indeed, the employee had been fired in 2011. However, the U.S. Supreme Court’s recent interest in the issue of mandatory arbitration and class action waivers in employment agreements likely drew the case out. Once Epic System was decided the outcome of this case could not have been suspenseful, though the case is unusual for having involved a non-profit college with mandatory arbitration for employees.