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In ordering arbitration of an employment dispute, a federal court in Texas upheld an arbitration agreement that seemingly limited the available remedies because the arbitration rules established that the agreement actually allowed a full range of remedies, thus enabling the employee to vindicate her statutory rights.
In Cameron v. National Resort Management Corp., No. 3:06-CV-1724-M, 2007 WL 580622 (N.D. Tex. Feb. 23, 2007), Cameron filed suit claiming her dismissal from National Resort Management (NRM) violated her rights under the Fair Labor Standards Act (FLSA). NRM responded with a motion to compel arbitration under a broadly worded agreement signed by both parties. The Court granted the motion.
At issue before the Court was Cameron's contention that the arbitration clause was unenforceable because it did not offer the full range of remedies afforded by the FLSA. Specifically, the arbitration agreement did not specify that liquidated damages and attorney fees were recoverable.
In rejecting Cameron's claims, the Court found that nothing in the agreement itself limited an arbitrator's power to award such damages and fees. On the contrary, the arbitration rules agreed upon by the parties specifically provided that an "arbitrator may grant any remedy or relief that he arbitrator deems just and equitable."
Given the absence of any language limiting monetary damages and the incorporation of rules allowing the arbitrator to craft a remedy, the Court held that the arbitration agreement would enable Cameron to vindicate her statutory rights and was thus enforceable. Accordingly, the Court ordered the parties to arbitrate.
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