The Expert's Examiner

The EEOC has formally rescinded its Clinton-era policy against mandatory arbitration of workplace discrimination claims.The Commission on December 17 issued Recission of Mandatory Binding Arbitration of Employment Discrimination Disputes as a Condition of Employment, formally abrogating its 1997 Policy Statement “that had disapproved of the practice of requiring workers to enter into arbitration agreements to resolve workplace discrimination claims and instructed its staff to proceed with claims against employers despite the existence of such agreements.” Why the change in policy? Says the EEOC: “Since its issuance, the Supreme Court has ruled that agreements to arbitrate employment-related disputes are enforceable under the Federal Arbitration Act (FAA) for disputes between employers and employees. Circuit City Stores v. Adams, 532 U.S. 105 (2001). In other arbitration-related cases it has decided since 1997, the Court rejected concerns with using the arbitral forum - both within and outside the context of employment discrimination claims. Those decisions conflict with the 1997 Policy Statement.” The Recission Statement has a long list of Supreme Court cases.

The Bottom Line: PDAAs are OK

The Recission Statement has a long list of Supreme Court cases backing up its assertion,  with the result that “the Policy Statement on Mandatory Binding Arbitration does not reflect current law, is rescinded, and should not be relied upon by EEOC staff in investigations or litigation.” Citing EEOC v. Waffle House, Inc., 534 U.S. 279 (2002), however, the revised policy notes that nothing therein “should be construed to limit the ability of the Commission or any other party to challenge the enforceability of a particular arbitration agreement.”