|
According to a Washington federal court, an arbitration clause in an employment agreement is not unconscionable when it clearly marks the arbitration provision and explains that agreeing to arbitration results in waiving a right to a jury trial.
In Cockerham v. Sound Ford, Inc., No. C06-1172JLR, 2006 WL 2841881 (W.D. Wash. Sept. 29, 2006), Cockerham sued her employer, Sound Ford, alleging racial and sexual harassment. Sound Ford moved to compel arbitration according to the terms of Cockerham’s employment agreement.
Cockerham conceded that the scope of the arbitration agreement covered her claims, but argued that the agreement was unconscionable. The Court examined the agreement for both procedural and substantive unconscionability and, finding neither, compelled the arbitration.
First, even though the Court acknowledged that the agreement was an adhesion contract because it was printed on a standard form and offered on a “take it or leave it basis,” the Court determined that it was not unconscionable because Sound Ford “did not hide the terms of the arbitration agreement.”
Ms. Cockerham also argued that the agreement was procedurally unconscionable because, had she read the arbitration agreement, she would not have understood what “arbitration” meant. The Court rejected this claim because the plain terms of the contract specified that by agreeing to arbitrate, she was waiving her right to a jury trial, which she understood as “one of the most important elements of our Constitution and our democracy.” This was enough to show an understanding of the term “arbitration.”
Second, the Court determined that the arbitration agreement was not substantively unconscionable because it limited discovery and authorized the arbitrator to award attorney fees, as Cockerham argued. The Court held that the agreement’s provisions “do not render the agreement so one-sided or overly harsh as to shock the conscience.”
The Court granted Sound Ford’s motion to compel arbitration because “[a]rbitration agreements formed in connection with contracts of employment…are enforceable under the [Federal Arbitration Act]” and Ms. Cockerham failed to carry her burden of proving that the agreement was unconscionable.
Subscribe to a free weekly update on ADR case law and
legislation
|