|
Under Oregon law, an arbitration agreement in an employment agreement is not invalid as unconscionable simply because it is offered on a take-it-or-leave-it basis and contains equal fee-splitting provisions.
In Gray v. Rent-A-Center West, Inc., NO. CV 06-1058-HU, 2007 WL 283035 (D. Or. January 24, 2007), Gray, a former employee of Rent-A-Center, brought an action alleging discrimination and violation of the Oregon Family Leave Act against Rent-A-Center.
When Rent-A-Center moved to compel arbitration pursuant to an arbitration clause in the employment agreement, Gray argued that the agreement was both substantively and procedurally unconscionable.
First, Gray argued that the agreement was procedurally unconscionable because it was a contract of adhesion, offered to him on a take-it-or-leave-it basis after his employment commenced. Gray also claimed that he did not read the arbitration agreement because it was not given to him.
The Court rejected this argument because, under Oregon law, adhesion contracts, while procedurally unconscionable, are not per se unenforceable. Additionally, "a party 'is presumed to be familiar with the contents of any document that bears the person's signature.'" First Interstate Bank of Or., N.A. v. Wilkerson, 876 P.2d 326, 330 n. 11 (1994). Therefore, since Gray signed the document, which clearly indicated that it included an agreement to arbitrate, he was presumed to be familiar with the arbitration agreement.
Gray next claimed the fee sharing provisions of the arbitration agreement rendered the agreement substantively unconscionable because the cost of arbitration would exceed the costs of bringing an action in court. The Court also rejected this argument because Gray provided "no authority to support [his] position that equal-fee splitting provisions would make the agreement unconscionable under Oregon law."
Subscribe to a free weekly update on ADR case law and
legislation
|