Continued Employment Viewed as Worker Acceptance of Employer-Instituted AgreementMarch 1, 2008
In 1999, a Tennessee employer wanted to implement a comprehensive arbitration agreement requiring its employee to pursue arbitration instead of court lawsuits for workplace discrimination, retaliation or harassment disputes or claims.
The company, AGF, called its arbitration initiative the Employee Disput Resolution (EDR) program.Its human-resources staff introduced the EDR program through a series of announcements and informational meetings. The company first informed employees about the EDR program in the Home Office Bulletin, a publication circulated to all company offices, including the office where the plaintiff, Ms. Seawright, was a branch manager.
In that same time frame, the company mailed letters to its employees informing them that the EDR program would become effective on a future date specified in the letter. Included with the letter was an informational brochure, which stated:“The AGF Employee Dispute Resolution is the sole means of resolving employment-related disputes between you and the company or you and another employee, including disputes for legally protected rights such as freedom from discrimination, retaliation or harassment, unless otherwise prohibited by law.
“You are still free to consult or file a complaint with any appropriate state or federal agency, such as the EEOC, regarding your legally protected rights. However, the program must be used instead of a trial if you are not satisfied with the results of the government-agency process, unless otherwise prohibited by law. Seeking, accepting or continuing employment with AGF means that you agree to resolve employment-related claims against the company or another employee through this process instead of through the court system.”The company then held group informational meetings explaining the program. A pamphlet distributed to employees during the meetings repeated the information outlined above. Seawright signed an attendance sheet acknowledging that she had attended the informational session and received a copy of the EDR pamphlet. The program went into effect and Seawright remained an employee for the next six years.
Two years after the program went into effect, the company mailed its employees a letter reminding them that the EDR program was still in effect and explained how to locate additional program information on the company’s intranet website. The letter included a brochure summarizing the program, similar to the other two brochures that had been distributed by mail and at the informational meetings. It included the same three paragraphs regarding the binding nature of the arbitration agreement and reiterated that “seeking, accepting or continuing employment with AGF means that you agree to resolve employment-related claims against the company or another employee through this process instead of through the court system.”Then in April 2005, Seawright was terminated and filed a civil lawsuit alleging discrimination under state law and alleging a violation of the Federal Family and Medical Leave Act (FMLA). The company filed a motion to suspend the civil court proceedings and to compel the case to go instead to arbitration, relying upon its EDR program instituted. Seawright opposed that motion to compel arbitration and argued that:
- 1) She did not assent to the EDR program and that there was no bargained-for exchange;
- 3) In the alternative, the arbitration agreement is void because it is a contract of adhesion or unconscionable.