Representation, Results & Binding Arbitration Agreements
Many employees are required to sign arbitration agreements as a condition of employment, waiving their rights to bring a lawsuit in court or having a jury hear their case.
Employment arbitration is a form of alternative dispute resolution (ADR) in which an impartial third party, known as an arbitrator, is used to resolve disputes between an employer and an employee.
The arbitration process typically involves both sides presenting their case to the arbitrator, who then makes a binding decision about the dispute. Binding arbitration agreements require arbitration decisions to be final and binding and can only be appealed in very limited circumstances.
Employment arbitration is often used as an alternative to going to court, as it can be quicker and less costly for the employee. Many arbitration agreements require employers to pay the costs of arbitration.
The attorneys at Potomac Legal Group have extensive experience representing employees, technology executives and high-earning sales professionals in complex arbitration proceedings.
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The Firm has secured millions of dollars in arbitration awards.
$2.8 million Arbitration Award to a Technology Executive for FMLA Discrimination
$200,000+ Arbitration Award to a Technology Salesperson for Unpaid Sales Commissions
Arbitration Agreement Consultations
Contact Potomac Legal Group to schedule a consultation regarding your arbitration matter. Our attorneys can advise you about arbitration agreements in employment contracts or employment disputes that may require arbitration proceedings.
Final Decisions without a Judge, Jury or Appeal
In arbitration, there is no judge or jury. The arbitrator or panel hears the case and renders a decision. The decision is final and binding, and the parties have agreed in advance to accept the decision as a resolution of their dispute.
Appeals are generally not possible. In limited circumstances, such as those involving fraud or misrepresentation by the arbitrator, violation of due process, or the arbitrator exceeding their authority, then an appeal may be possible. However, these appeals are rare, and arbitration decisions generally stand without any appeal by either party.
In other words, an employer who is a defendant in arbitration will have more difficulty challenging an arbitration decision in favor of an employee.
Arbitration for Tech Employees
Arbitration is commonly used in the technology industry to resolve employment disputes. Potomac Legal Group’s attorneys have experience representing employees in some of the common types of disputes that may arise in technology employment, including:
- Discrimination and harassment claims: Employees may file claims of discrimination or harassment based on race, gender, age, or other protected characteristics.
- Family Medical & Leave Act (FMLA) discrimination and retaliation claims.
- Non-compete and trade secret disputes: Employees may be bound by non-compete agreements or have access to sensitive trade secrets that they are prohibited from sharing with competitors.
- Severance and termination disputes: Employees may dispute the terms of their severance or termination, such as the amount of severance pay or the reason for termination.
- Intellectual property disputes: Employees may dispute the ownership of intellectual property created during their employment, such as software or patents.
- Benefits and pay disputes: Employees may dispute the terms of their benefits or pay, such as the amount of overtime pay or the availability of health insurance.
Arbitration for Unpaid Sales Commissions
As part of its Employment Practice, our attorneys specialize in unpaid sales commission disputes. The Firm has significant experience representing professional salespeople in technology sales, federal sector sales, open-source service contracts, SaaS, CaaS and more. The Firm has represented salespeople in negotiation, litigation and arbitration for many types of disputes, including:
- Commission agreements: Salespeople may disagree with their employers about the terms of their commission or variable compensation agreements, such as the commission rate or the sales that qualify for commissions.
- Failure to pay commissions: Salespeople may claim that their employer has failed to pay them the commissions they are owed, either in full or on time.
- Termination of employment: Salespeople may dispute the commission payments they are entitled to upon termination of their employment.
- Misclassification of employees as independent contractors: Salespeople may claim that they were misclassified as independent contractors and are entitled to commissions and other benefits as employees.
Remote arbitration proceedings typically follow the same format as in-person proceedings over secure video conferencing. The hearing itself can also be conducted through video conferencing, and the arbitrator can review documents and evidence electronically.
Remote arbitration proceedings have some advantages, such as more options in choosing the attorney who represents you. Although arbitration agreements usually have a venue and choice of law provision, your attorney may be located anywhere and represent you with the assistance of local counsel after a pro hac vice motion is granted.
Travel is no longer an expensive barrier to effective legal representation in remote arbitrations.
Is Arbitration Less Burdensome than Court Litigation?
Arbitration can be faster than going to court in some cases. The arbitration process typically proceeds more quickly than a court case because there are fewer procedural requirements and a more streamlined process. Additionally, the arbitration schedule can proceed more quickly than a court-issued schedule.
Federal Arbitration Act
The Federal Arbitration Act (FAA) is a federal law that was enacted in 1925 to promote the use of arbitration as an alternative to litigation in the United States. The main purpose of the FAA is to ensure that arbitration agreements are enforced and that arbitration awards are given the same legal status as court judgments.
The FAA applies to all arbitration agreements involving commerce that are entered into by any person engaged in commerce, or by any maritime transaction. The FAA makes arbitration agreements “valid, irrevocable, and enforceable,” except upon such grounds as exist at law or in equity for the revocation of any contract, and provides for the enforcement of arbitration awards.
The FAA also lays out specific rules and procedures for the conduct of arbitration proceedings, including the selection of arbitrators, the location of the arbitration, and the rules of evidence that will apply. It also allows for the court to confirm, modify, or vacate an arbitration award, but only under limited circumstances such as evident partiality or corruption in the arbitrators, misconduct, or the arbitrators exceeded their powers.
Arbitration Decisions: Binding & Enforceable
Arbitration decisions are generally considered to be binding in court. This means that the parties have agreed in advance to be bound by the decision of the arbitrator and that the decision is final and cannot be appealed.
In addition, the parties can agree that the arbitration decision is not binding, and in this case, the decision will not be considered as final.
Also, under the Federal Arbitration Act, a court can vacate (set aside) an arbitration award if:
- The award was procured by corruption, fraud, or undue means.
- There was evident partiality or corruption in the arbitrators.
- The arbitrators were guilty of misconduct in refusing to postpone the hearing, upon sufficient cause shown, or in refusing to hear evidence pertinent and material to the controversy, or any other misbehavior by which the rights of any party have been prejudiced.
- The arbitrators exceeded their powers, or so imperfectly executed them that a mutual, final, and definite award upon the subject matter submitted was not made.
It’s important to note that the arbitration agreement should be clear about the binding nature of the arbitration decision and whether the decision can be appealed in court.
Arbitration Proceedings: AAA & JAMS
The American Arbitration Association (AAA) and JAMS (formerly known as Judicial Arbitration and Mediation Services) are both private organizations that provide arbitration and mediation services. They have some similarities, but there are also some key differences between them.
Arbitration agreements typically reference AAA or JAMS as the entity that will provide arbitration services in your proceedings.
One of the main differences between AAA and JAMS is the types of disputes they handle. The AAA primarily handles consumer disputes, employment disputes, and construction disputes, while JAMS handles a wide range of disputes, including commercial disputes, construction disputes, employment disputes, and intellectual property disputes.
Both AAA and JAMS have their own set of rules, procedures, and forms that parties must follow during the arbitration process. Parties can also choose to use their own arbitration rules if they prefer.
Selecting the Arbitrator
In many cases, the parties in an arbitration case are able to choose their own arbitrator. This is known as “agreed-upon arbitration” or “party-appointed arbitration.” The parties can agree on a specific individual to serve as the arbitrator, or they can agree on a list of potential arbitrators from which to choose. This can be done before the dispute arises or after the dispute has arisen.
In other cases, the arbitrator is appointed by an arbitration organization or institution. This is known as “administered arbitration” or “institutional arbitration.” The institution will typically have a panel of arbitrators to choose from, and the parties do not have the right to choose the specific individual who will serve as the arbitrator.
In either case, it’s important to note that the arbitrator selected should be impartial and have the relevant experience and qualifications to handle the dispute. The parties should also check if the arbitrator has any potential conflicts of interest before the proceeding starts.
Schedule Your Arbitration Review Today
Contact Potomac Legal Group to schedule a review of your arbitration agreement or to discuss initiating an arbitration proceeding. Our experienced employment arbitration attorneys are available to schedule a review of your arbitration matter, or to answer any questions you have about your employment matter.