Third Circuit Affirms Enforcement of Employer-Employee Arbitration Agreement
On June 20, 2018, the United States Court of Appeals for the Third Circuit held than an arbitration agreement between an employer and employee was still enforceable regardless of whether the employee read the agreement. Ace Am. Ins. Co. v. Guerriero, 2018 WL 3057005 (3d Cir. 2018). In this case, the employee argued that the arbitration agreement was unenforceable because he never received the first two pages of his employer’s Employment Dispute Arbitration Policy. The Court ultimately found in favor of the employer and affirmed the lower court’s decision by finding that there was an agreement to arbitrate and that this dispute fell within the boundaries of that agreement.
Even considering the strong federal and state policies in favor of arbitration, the courts must find that there was a clear agreement between the parties with an intent to arbitrate. If there is an actual agreement to arbitrate, then the court will only find the agreement unenforceable if there is fraud or misconduct that would prevent mutual assent and failure to read the agreement is not a reason to find the agreement unenforceable. Here, the Third Circuit found that the agreement was enforceable because there was mutual assent and a lack of fraud that would excuse the employee from reading the agreement. The employee signed two separate documents showing his intent to arbitrate. Even if the employee’s assertion that he did not have the first two pages of the agreement was correct, the Court found this argument unpersuasive because the employee had access to the agreement through the employer’s website. The Court further stated that “even if there were any ambiguity or question over the scope of the Employment Dispute Arbitration Policy, we would apply the presumption in favor of arbitration.”
At the Law Offices of Sidkoff, Pincus & Green our experienced Philadelphia employment lawyers handle many types of legal matters, including arbitration agreements. If you are interested in having a consultation with one of our Philadelphia business lawyers, please call us at 215-574-0600 or contact us online.