California Workplace & Employment Law Blog

During the U.S. Supreme Court’s most recent term, the Court held that companies can use arbitration agreements to prohibit workers from suing their employers in class action lawsuits. This means that an employer can include a clause in its arbitration agreements which requires the employee to waive the right to bring any claims against the employer as part of a class action lawsuit.

The three key documents that every employer should provide to their employees consists of an employee handbook, a confidentiality agreement, and an arbitration agreement.  In advising small and mid-size businesses, I have found that the majority of these employers not only do not have their employees sign an arbitration agreement, but they are usually not aware of what arbitration even is.  As I’ll explain below, an effective arbitration agreement is the key to keeping employment-based claims out of court, significantly minimizing your attorneys’ fees should an employee file suit, and preventing runaway jury awards.