Discrimination claims are arbitrable in accordance with an arbitration agreement in an employment contract when the contract sets forth a method of compensation and the employee characterizes the failure to follow that method as evidence of discrimination, according to the Sixth Circuit Court of Appeals.

In Panepucci v. Honigman Miller Schartz & Cohn LLP, No. 05-2579, 2008 WL 2467979 (6th Cir. June 18, 2008), Panepucci was an equity partner attorney at the Honigman firm. After she was allegedly denied certain compensation, Panepucci sued Honigman for discrimination and retaliation. Honigman moved to compel arbitration in accordance with an agreement in the parties' partnership contract. The district court granted the motion, finding the claims arbitrable under the agreement, which required arbitration of any dispute "arising under or related to" the partnership contract.

On appeal, the Court characterized the district court's decision as "unassailable," holding that Panepucci's discrimination claims could not be maintained without reference to the partnership contract containing the arbitration agreement. Because the partnership agreement provided the method for calculating a partner's compensation, and Panepucci alleged that the failure to apply that method was evidence of discrimination, the Court determined that her claims required reference to the contract and were therefore arbitrable.