May It Please the Court® A Weblog of Legal News & Observations
Quote of the Day - This measure [class action reform bill] is a common-sense measure. It will ensure that people have a right to sue when harmed, and at the same time the bill will put an end to suits that leave consumers with pennies and small businesses with needless legal bills. - Christopher Dodd

Specific Employment Class Action Waiver Held Enforceable

In the twisted, mixed-up area of the class-action waivers in contracts, we got some clarification from one of the courts involved in this mess.  Certain class action waivers in employment contracts are enforceable, and employers can enforce arbitration agreements instead of engaging in litigation.

Not all class action waivers are enforceable, however.  The Supreme Court has ruled such waivers unenforceable in the consumer credit card context, so it apparently depends on the provisions of the waiver itself.  According to this new court of appeal opinion, class action waivers are enforceable when employment is not conditioned on signing the waiver, employees are given time to contemplate the waiver and employees have some opportunity to opt-out of it. 

With those caveats in your employment agreements, you can avoid expensive and time-consuming litigation and proceed to arbitration of employee claims.  Without them, well .... you know my number. 


Posted by J. Craig Williams on Friday, January 20, 2006

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