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Your company includes a pre - dispute arbitration clause in all its employment contracts. This clause provides for mandatory legally binding arbitration of any dispute,
Your company includes a predispute arbitration clause in all its employment contracts. This clause provides for mandatory legally binding arbitration of any dispute, claim or controversy relating to the employment. This clause is in the contract of every current employee of your company.
You have just completed the hire of new employees. One of them, Linda, is especially attractive as a new hire because she contributes to the diversity of your workforce. When you call Linda with the job offer, she verbally accepts. You and Linda agree that she will come to the office to meet with HR to sign the paperwork for the position. On the agreed upon day, after she reads the paperwork, she comes to your office to express her dissatisfaction with the predispute arbitration clause. She tells you that this is the first she has heard about the clause, that she feels she would be compromising her legal rights by signing it and she will not work for the company unless you take it out of her contract.
You ask Linda to wait for a few minutes so you can call your supervisor. The supervisor reminds you that finalizing Linda's hiring is important because the company has been criticized for its lack of diversity and that you'll be held responsible if she "gets away". The supervisor instructs you to have Linda come back into your office and explain to her that the contract is something that the legal department insists on for every employee, but it's just a formality and that if there ever was a dispute, the company would not attempt to enforce the predispute arbitration clause. You know from your study of business law that oral modifications of written contracts are generally unenforceable, and that the legal department will do everything it can to enforce that arbitration clause if there ever is a dispute.
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