Why the Harvey Weinstein Scandal Should Scare the Pants Off Employers

Unless you have been living in a cave for the last month, you have heard about the sexual misconduct allegations against Hollywood mogul Harvey Weinstein. The story has all of the makings of a Hollywood blockbuster, except this time it’s not a movie. Here’s why it should also raise the curtain for employers outside of Tinseltown.

Why the Harvey Weinstein Scandal Should Scare the Pants Off EmployersRising Tide of Allegations Will Result in Increased Scrutiny

The Weinstein allegations have triggered an avalanche of claims against Hollywood stars, celebrity chefs, executives and politicians unlike anything in recent memory. The EEOC has weighed in with renewed interest in harassment claims, seizing upon an opportunity to publicize the issue. Those who use their workplace positions to make unwelcome sexual advances deserve to be called out for their misconduct. To be clear, this post is not for them. However, the sheer number of allegations regarding misconduct that occurred years ago and were never reported poses a real problem for conscientious employers. What does this mean for employers who face fallout for this kind of misconduct?

First, employers will have to deal with increased administrative interest. Undoubtedly, the EEOC will more carefully scrutinize claims of harassment and increase litigation efforts against companies alleged to harbor harassers, especially in the C-suite. Second, litigation could get tougher. Juries and courts may be more inclined to believe that alleged harassment occurred and to disbelieve denials by an accused executive and by extension his or her employer. In short, we will likely see an increase in claims, so what can employers do?

An Ounce of Prevention

You have heard it before but it bears repeating. While employers can’t stop employees from acting badly, they can take steps to try to prevent bad conduct and to properly address it when brought to their attention.

  • Review your policies. Any employer reading this almost certainly has a policy against harassment or discrimination, but far too often we see employers with cut and paste policies gleaned from another company or pulled off the internet that don’t really align with their workplace. You need clear, well-thought-out policies that your employees understand. Be sure the policy explains what harassment is and encourages people to report it.
  • Identify the right person to receive complaints. A policy merely advising employees to report harassment to their immediate supervisor, who has little or no training in how to identify or address harassment, often proves of limited help. Think about who is best to receive allegations about harassment and to properly address them and draft your policy to match. Clear policies with carefully crafted reporting procedures (perhaps supplemented with a third-party hotline option) can help.
  • Distribute the policy. A policy buried in a handbook, with no stand-alone employee acknowledgment, can be portrayed as mere words on the page with no real meaning. Worse still, employees may claim (sometimes truthfully) that they never received or read it. A policy given to employees and acknowledged in writing is critical.
  • Training, training, and more training. The again obvious, but often overlooked or sporadically implemented, additional step is education and training. For those of you in states that require annual training, make sure you do it and document it. For the rest of the country, have annual training of management in EEOC matters and trends. Add training of HR staff in how to identify, investigate and address allegations. Make sure your supervisors can identify harassment and know what to do when they see it or get a complaint. Educate employees in the company’s reporting procedures and make sure they understand that the company will not tolerate retaliation for a complaint. Finally, implement the training in a manner that avoids the holes created by employee and supervisory turnover.

Again, all of this sounds obvious but it can mean the difference between preventing harassment in your workplace and being found liable for the bad acts of people who you thought knew better.

Trick or Treat? Employee Claims Discrimination After Attending Office Halloween Party

Trick or Treat? Employee Claims Discrimination After Attending Office Halloween PartyBefore you send out that next office-wide invite to a “holiday” party, think twice. Carmelite Lofton has sued her employer, BSN Sports, LLC—a Texas uniform and equipment retailer—when things turned sour after she was forced to attend an office Halloween party. Lofton—an African American and a Christian, says the party was contrary to her religious beliefs and afterward she endured verbal and professional slights due to her race, religion, and disability.

The Legal Issues

The complaint contains claims under the Americans with Disabilities Act, Title VII, and the Lily Ledbetter Fair Pay Act of 2009.  She argues that for the entirety of her employment she was subject to a hostile work environment, discriminated against on the basis of her disability (osteoarthritis), and paid less than her colleagues because of her race and religion. She argues that her termination in March 2017 was unlawful and motivated by discriminatory factors.

          Disability Discrimination Claims. Regarding her disability claim, Lofton alleges that she told BSN about her osteoarthritis at the start of her employment, but was still made to perform strenuous physical activities in direct contravention of her doctor’s orders. Under the ADA, employers are charged with providing reasonable accommodations to workers with known disabilities. Reasonable accommodations can include things such as time off, modified duties, or even a special work area if it will aid the disabled employee in carrying out their job responsibilities.

Here though, Lofton argues that BSN refused to accommodate her and terminated her employment under false pretext. Specifically, Lofton points to being made to stand for over an hour while in “excruciating pain” at the Halloween party and having to clean and pack the BSN office building after it had been damaged in a flood.

          Religious Discrimination Claims. Beyond experiencing discrimination and a hostile work environment because of her disability, Lofton also asserts that her religion was a cause of conflict during her time at BSN. Specifically, Lofton alleges (1) her superiors told her she was “going to hell” for bringing in tootsie rolls, (2) she was told she “didn’t have a choice” of whether she participated in the office Halloween party, and (3) she was intentionally asked to accompany her manager to “Condom Sense” despite the knowledge that it was opposite to her religious ideals.

Lofton recites a series of alleged cringe-worthy incidents ranging from management’s off-handed comments against the Bible to being continually interrupted during private prayer meetings held during her lunch break to being told she should “just have Kool-Aid” when she refused to drink alcohol with her colleagues. Regardless, Lofton’s complaint is chock full of alleged derogatory exchanges in support of her religiously hostile work environment claim.

          Race Discrimination Claims. Lofton claims she was treated differently because of her race. To argue a disparate treatment claim, Lofton must show that her employer intentionally discriminated against her or treated her less favorably because of her race.

Here, Lofton argues that her non-African American colleagues were paid more for doing the same job and/or for doing a job with lesser duties and responsibilities. Further, she asserts that her non-African American colleagues did not have to use PTO when out for injuries or illnesses, whereas she was forced to use PTO for her osteoarthritis surgery. To strengthen her claim, Lofton includes that her superior has previously been accused of racial discrimination, citing a 2015 incident where an email with “a stick figure being hung on a noose” was distributed company-wide.

So What Does This Mean for Employers?

All we know is what Ms. Lofton says in her complaint and we all know that BSN’s version of events is likely to tell a different story. The question now becomes, as employers, what can we learn from this complaint?

  1. Check your policies. For starters, this is an excellent time to re-evaluate your company’s policies and to focus on maintaining a workplace that is welcoming to all, regardless of race, religion, gender, disability, etc. Recognize that an employee’s religious beliefs are protected and make sure they are not the subject of jokes or potentially disparaging comments.
  2. Rethink mandatory holiday celebration. Refrain from forcing any employee, regardless of religious belief, to attend company holiday functions. It is far too easy to blur the line between optional and compelled attendance, but once blurred, you run the risk of facing the same type of problem now facing BSN.
  3. Keep your management and staff up-to-date on non-discrimination policies, have routine sensitivity training, and take the position that discriminatory behaviors will not be tolerated in any form or fashion. Encourage your staff to speak with HR or to use other resources to report instances of what they believe is discrimination.
  4. Do a quick audit. Look around to make sure people who have disclosed potential disabilities are being appropriately accommodated. For employees with obvious disabilities, check to see if they have requested accommodations and haven’t yet gotten them. Check their files to see if they have submitted anything in writing. If you find someone who has been overlooked, find a way to do it…quickly.

Changing of the Leaves: EEOC Again Pushes for Additional Leave as ADA Accommodation

Changing of the Leaves: EEOC Again Pushes for Additional Leave as ADA AccommodationWe have said it before — the EEOC believes that leave is a reasonable accommodation and automatic termination when FMLA leave runs out violates the Americans with Disabilities Act. Even though at least one federal court has made clear it disagrees, the EEOC continues to press the point and has recently filed a lawsuit against the Blood Bank of Hawaii for failure to provide reasonable accommodations for and then firing employees who required additional leave time for their disabilities.

The Allegations

The EEOC contends that the blood bank had “a rigid maximum leave policy” under which employees with disabilities who ran out of FMLA leave were not granted a leave of absence as a reasonable accommodation. The complaint also alleges that employees returning from leave were required to return to work without limitations. As a result, some folks lost their jobs. The EEOC thinks this violates the ADA.

According to the EEOC:

“Employees should never be terminated or forced to resign simply because they need additional leave for their disabilities.”

Takeaways

The EEOC is looking for disability cases. It has issued guidance on leave as a reasonable accommodation, and going after inflexible leave policies is one of six national priorities identified by the Strategic Enforcement Plan. With that in mind, make sure you don’t end up as a target.

  1. Check your policies. If any of them state or suggest that an employee who exhausts FMLA leave will immediately be terminated, change them. The EEOC has made it clear it wants no bright lines.
  2. Train your managers and supervisors. Make sure people understand that the company will always consider a reasonable accommodation. It might be some amount of leave, it might not. What you want to avoid is a supervisor (or an HR manager) saying “We always terminate people who can’t return from leave—no exceptions.”
  3. Check you return to work letters. Eliminate any language that says “you have to return to work without restrictions.” That kind of talk will get you sued. No matter what the restriction, you have to consider whether you could provide a reasonable accommodation.
  4. Always consider vacant positions. The ADA requires that you consider whether the employee can perform (with or without a reasonable accommodation) the essential functions of a vacant position for which he or she is qualified. You may not have a vacancy, and you don’t have to create one—but you always need to check. If the employee can perform the vacant position (even if it pays less), offer it as a reasonable accommodation. Also, it doesn’t have to be a temporary assignment.

The ADA is tricky and every situation is different. Have a process to follow but don’t rely on bright lines.

Putting a Finger on a Problem? Employees Challenge Biometric Scanners as Violating Privacy

Putting a Finger on a Problem? Employees Challenge Biometric Scanners as Violating PrivacyEmployers, if you have ever wondered how much security is too much, there may be an answer coming sooner than you think. In a recently filed complaint, Martin Ragsdale, an employee of the Paramount of Oak Park Rehabilitation & Nursing Center, alleged that the company’s use of biometric data violated his and his coworkers’ individual privacy rights under the Illinois Biometric Information Privacy Act (BIPA).

Paramount requires employees to scan a fingerprint to clock in and out, to confirm identity, and as a security measure. The company believed that the new system would help eliminate common forms of timekeeping fraud and produce a more streamlined operation. Little did they know that what saved them money on the front end may now end up costing them far more on the back end of this litigation.

The Legal Issues

In the complaint, Ragsdale emphasizes the invariable nature of biometric identifiers, explaining that personally identifiable information (PII) such as Social Security numbers can be changed, whereas biometrics—fingerprints, DNA, eye scans—are “biologically unique” and unchangeable. He argues that the BIPA requires organizations to go through a series of steps that involve communication with individuals and getting their consent to use their biometrics before collecting and storing their biometric data. Further, Ragsdale argues that the BIPA mandates that entities collecting biometric data make their data retention and deletion policies publicly available.

Ragsdale’s complaint asserts that Paramount collected biometric data without notifying the employees that it intended to do so, without obtaining consents after the practice was established and without publishing the requisite data storage and deletion policy as required by the BIPA. He further alleges that each time Paramount transmitted the biometric data to third-party and out-of-state vendors a violation of the BIPA occurred.

As of yet, Paramount has not filed its response to the complaint. However, the stakes are potentially high. Each “willful and/or reckless” violation of the BIPA is worth $5,000, and each “negligent” violation is worth $1,000.

This is not an issue limited to Illinois. Although only three states (Illinois, Washington and Texas) have laws specifically targeting the collection of biometric data, there are bills currently pending in Alaska, Connecticut, Massachusetts, and New Hampshire. According to the National Conference of State Legislatures, 48 states, as well as the District of Columbia, Puerto Rico and the U.S. Virgin Islands, have enacted some form of privacy laws to safeguard the collection of personal information. To date, Alabama and South Dakota are the only two states with no similar security laws.

So What Does This Mean for Employers?

If you are considering using a practice that involves the use of PII, biometrics, or any other potentially sensitive information, you should check your state’s laws to see what hoops you need to jump through. If you have already adopted such a practice, check to be sure you complied with the applicable privacy legislation. While your state may not have a law addressing biometrics, the collection and storage of PII may still be addressed in other rules and regulations. Next, you should make sure that your current practices are in line with the statutory requirements, and if they are not, you should find the most expedient way to fix them. And last but certainly not least, as an employer, you should re-evaluate your current level of transparency with your employees.

An ounce of prevention is worth a pound of cure. While the implementation of new technology boasts of improved and more secured operations, employers would do well to remember that with great cybersecurity comes even greater responsibility. Guard your employees’ biometric data now or run the risk of having to pay for it later.

Alabama Employers Take Note – Birmingham Joins Ranks of Cities with an Anti-Discrimination Ordinance

Alabama Employers Take Note – Birmingham Joins Ranks of Cities with an Anti-Discrimination OrdinanceLast month, the Birmingham City Council passed an ordinance criminalizing discrimination in education, housing, employment, and public accommodations. The ordinance not only prohibits discrimination based on the federally protected categories of race, sex, national origin, and disability, but it also recognizes familial status (i.e., having minor children), sexual orientation, and gender identity as protected categories. Additionally, the ordinance creates a new Human Rights Commission to handle discrimination complaints. Members of the commission will include the police chief, fire chief, ADA compliance director, a city council staff member, city council district appointees, and representatives from other local organizations.

What the Ordinance Provides

An individual can file a discrimination complaint by seeking a warrant or summons from a magistrate in the Birmingham Municipal Court. The magistrate will refer the complaint to the new Human Rights Commission to investigate and attempt to conciliate the complaint. If the commission does not resolve the matter, it then will go to trial in the municipal court. If found guilty, a business may face a $500 maximum fine. Although that remedy is insignificant relative to damages available under the federal anti-discrimination statutes (backpay, reinstatement, potentially uncapped damages), employers should keep in mind that a plaintiff in federal court could point to a prior municipal court ruling against an employer as evidence of discrimination. Weighing that possibility and also considering the near certainty that an employer would spend more than $500 defending a municipal court claim, employers should look to resolve such claims swiftly.

When Does It Take Effect?

Birmingham’s mayor must sign the ordinance for it to take effect, and that has not yet happened. That task apparently was moved to the backburner after Birmingham’s incumbent mayor, William Bell, lost to opponent Randall Woodfin in an October 3 runoff. Both Bell and Woodfin have expressed support for the ordinance, so we can expect that one of them will sign it into law at some point. Woodfin plans to take office on November 28.

Even assuming the mayor signs the ordinance, the Alabama State Legislature could possibly challenge it. The legislature is not in session again until early 2018 and has not hinted at opening a special session. Legislators are perhaps staying quiet on the issue while Birmingham and Huntsville pursue bids for Amazon’s second headquarters, in light of North Carolina’s recent economic backlash over the state legislature striking down Charlotte’s transgender bathroom ordinance.

Lastly, the city council president who spearheaded the ordinance lost his seat in a runoff shortly after its enactment, and it remains to be seen whether the new city council will follow through on getting the mayor’s signature and creating the new Human Rights Commission.

So, not surprisingly, the new ordinance raises more questions than it provides answers — employers should stay tuned for further developments.

I Wish They All Could Be California Non-Binary: Governor Brown Signs Law Approving New Gender Status

I Wish They All Could Be California Non-Binary: Governor Brown Law Approving New Gender StatusMale and female are no longer the only gender identifiers available, at least in two states. California’s Gov. Jerry Brown has signed into law the Gender Recognition Act which (1) allows individuals to identify as non-binary and (2) makes it easier for individuals to change their gender identifier in certain state records. In the past, for a person to have their gender changed on a birth certificate or driver’s license, they had to present proof that they had undergone treatment to change their gender (with male and female as the only options) and have a court hearing. The new law allows someone to change their gender simply by filing an affidavit under penalty of perjury that the request is to conform the person’s legal gender to the person’s self-identified gender identity. Under the new law, a person can attest to a gender identity of female, male or non-binary.

The law also specifically addresses California drivers’ licenses. In 2019, an applicant for a new license or a renewal can choose a gender category of female, male, or non-binary.

California joins Oregon as the only two states so far that have adopted this third category of gender.

How Will This Affect an Employer?

While neither the California nor Oregon laws appear to require employers to change any of their forms, the establishment of the new non-binary gender category may make the use of a universal form difficult if you have employees in those states.

Another Shameless Self Promotion: Vote for Labor & Employment Insights as The Best Legal Blog

Dear Readers,

We’re honored to announce that our Labor & Employment Insights blog has been nominated to compete in The Expert Institute’s Best Legal Blog Contest – one of the largest competitions for legal blog writing online today.

From a field of hundreds of potential nominees, our blog received enough nominations to participate. Now that the blogs have been nominated and placed into their respective categories, it is up to their readers to select the very best.

Each blog will compete for rank within its category, while the three blogs that receive the most votes in any category will be crowned overall winners.

Are we your “write” choice?

Another Shameless Self Promotion: Vote for Labor & Employment Insights as The Best Legal BlogFor more than a year now, we’ve strived to provide informative, timely and interesting posts on changes in labor and employment law. If you’ve appreciated our writings, we’d appreciate your vote!

How to Vote

Simply click here or on the nominee badge to cast your vote for our Labor & Employment Insights blog. Information about the competition can be found on The Expert Institute website.

About The Expert Institute

Founded in 2011, The Expert Institute is a technology-driven platform for connecting qualified experts in every field with lawyers, investment firms and journalists looking for technical expertise and guidance. The Expert Institute combines a vast database of prescreened experts with a talented case management team capable of custom recruiting experts to fit the specific needs of our clients. The Expert Institute also maintains one of the internet’s most visited blogs on expert witnesses, in addition to an extensive case study archive and expert witness resource center.

Federal Agencies Announce Plan B for the Contraceptives Mandate

Federal Agencies Announce Plan B for the Contraceptives MandateThe triumvirate of federal agencies (HHS, DOL, IRS) responsible for enforcing the Patient Protection and Affordable Care Act (the ACA, often called Obamacare) released final interim rules significantly expanding exceptions from what has become known as the “contraceptives mandate.” This mandate, which has been the subject of extensive and ongoing litigation and political debate, will now not apply to employers, group health plans, insurance issuers, and individuals who object to the mandate “based on sincerely held religious beliefs.” It will also not apply to nonprofits, closely held for-profit entities, and individuals who object “based on sincerely held moral convictions.”

What is the Contraceptives Mandate?

Under the ACA, employers, group health plans and insurance issuers must provide coverage without cost sharing for women’s preventative care and screenings. Under the Obama administration, the Health Resources and Services Administration interpreted this to require coverage for contraceptives, such as birth control medication. Originally, there was an exemption available only for nonprofit “religious employers” with religious objections to contraceptive coverage. The exemption was later expanded to “houses of worship and their integrated auxiliaries” and eventually to closely held, for-profit entities with similar religious objections, such as Hobby Lobby. See Burwell v. Hobby Lobby Stores, Inc.

What entities are eligible for the exception?

The entities who object to any involvement in the provision of coverage for contraceptives based on sincere religious beliefs or moral convictions (Objecting Entities) are excepted from the application of the contraceptives mandate. In regards to sincerely held religious beliefs, essentially all nongovernmental employers may be Objecting Entities. In regards to sincerely held moral convictions, only the following may be Objecting Entities: (1) a nonprofit organization, (2) a closely held for profit entity or (3) an institution of higher education in its arrangement of student health coverage. The agencies provide no guidance as to what it means to have sincere religious beliefs or moral convictions but explain that the mechanisms for making such determinations are a matter of “well-settled” state law.

Are there steps to becoming an Objecting Entity?

No. Entities claiming an exemption from the contraceptives mandate were previously required, in general, to seek an “accommodation” and provide certain notices. Now, there are no applicable certification or reporting requirements, although the accommodation process is still being made available on an optional basis.

If I become an Objecting Entity, can I just stop offering coverage for contraceptives?

No. Under ERISA, a group health plan will still be required to list contraceptives as specific exclusions from coverage and provide notices regarding the reduction in coverage to all persons covered under the plan.

If I am an employer or issuer, can I offer a plan that does not cover contraceptives?

Yes. Even governmental employers may do so. Even if an employer or issuer is not an Objecting Entity, one or more of its employees or covered individuals may be an “Objecting Individual” – that is, an individual who objects to coverage for contraceptives based on sincere religious beliefs or moral convictions. The regulations specifically allow for such “willing entities” to offer a separate plan or benefit package to Objecting Individuals that does not include coverage for contraceptives.

If I am an employer or issuer, do I have to offer a plan that does not cover contraceptives?

No. The preambles to the regulations provide that this “individual exemption” cannot be used to force an employer or issuer to provide coverage omitting contraceptives.

Will the regulations be challenged?

Yes. The regulations will almost certainly be immediately challenged on procedural grounds based on their adoption as “interim final rules,” which makes the regulations immediately effective and circumvents the notice and comment period required by the Administrative Procedures Act. Additionally, the substance of the regulations will undoubtedly be challenged in multiple ways, particularly where the exemption is provided based on “moral convictions.”

Sessions Changes DOJ Course on Title VII Enforcement for Transgender Issues

Sessions Changes DOJ Course on Title VII Enforcement for Transgender IssuesU.S. Attorney General Jeff Sessions issued a memo to all U.S. Attorneys revising how the Department of Justice will address gender identity claims under Title VII. In 2014, the Obama Administration DOJ stated that gender identity discrimination, including that against transgender individuals, was illegal under Title VII’s prohibition against sex discrimination. AG Sessions’ memo reversed that practice, concluding instead that federal law does not prohibit discrimination based on gender identity, per se.

What does “per se” mean?

As outlined in the memo, issued on Wednesday, October 4, 2017, the DOJ has decided to look strictly at the words of Title VII. While the statute prohibits discrimination “because of . . . sex,” the AG notes that it does not specifically refer to or protect “gender identity.” The AG’s memo does recognize that the Supreme Court bars “sex stereotypes” where they cause disparate treatment of men and women. However, the AG does not believe that the language of Title VII prohibits employment practices that take account of the sex of employees, but do not impose different burdens on similarly situated members of each sex. For example, the AG points out that Title VII would not cover claims based on sex-specific bathrooms. As such, the critical issue is whether members of one sex are exposed to adverse terms or conditions of employment that are not placed upon members of the other sex.

The memo states that the DOJ will continue to affirm “the dignity of all people, including transgender individuals” and does not condone the mistreatment of people based on gender identity.

How will this affect employers?

If your business is one of the rare ones that has been the subject of a DOJ investigation based on claims of gender identity discrimination—that should end. However, it is unclear how this will affect the more common way that the government enforces employment discrimination laws—through the EEOC, an agency that is not under the DOJ. We have already seen one instance this year in a Second Circuit case in which the EEOC has taken the position that sexual orientation is covered by Title VII while the DOJ is arguing that it is not.

Most importantly, as the AG memo acknowledges, the Supreme Court has recognized that gender stereotyping, which is usually a large part of any transgender or gender identity claim, is still illegal.

Murphy’s Law: Will the Supreme Court End Employment Contract Arbitration Clauses?

Can you prevent employees from pursuing class actions if you have the right employment agreement? Employment agreements routinely include arbitration clauses that require employees to waive their right to pursue work-related claims through collective or class actions. Instead, employees agree to resolve disputes through individual arbitration. But the validity of these arbitration clauses is unclear and is now before the United States Supreme Court. The Supreme Court heard oral argument earlier this week in National Labor Relations Board v. Murphy Oil, USA, Inc. and two other consolidated cases about whether such clauses violate the National Labor Relations Act (which governs employer-employee relations) or whether the Federal Arbitration Act (which governs arbitration agreements) trumps the NLRA.

The cases that the Supreme Court is reviewing come out of the Fifth, Seventh and Ninth Circuit Courts of Appeal. The Fifth Circuit held that an employer lawfully enforced an arbitration clause in its employment agreement and did not violate the NLRA. The Seventh and Ninth Circuits held the opposite—finding similar arbitration clauses unenforceable because the NLRA prohibits class waivers in employment agreements.

Employment contract arbitration clauses are currently enforceable in the Second, Fifth, and Eighth Circuits (shown in green below) and unenforceable in the Seventh and Ninth Circuits (shown in red below).

Murphy’s Law: Will the Supreme Court End Employment Contract Arbitration Clauses?

Why Murphy Oil Matters

The Supreme Court’s decision in Murphy Oil is worth watching. If the Supreme Court holds that these arbitration clauses do not violate the NLRA (or that the FAA overrides the NLRA), employees who have signed such clauses will be required to litigate employment-related disputes on an individual basis before an arbitrator. Conversely, if the Supreme Court finds that these clauses violate the NLRA, employees can pursue lawsuits on a collective or class basis, notwithstanding an employment agreement that purportedly waives such rights.

How Best to Structure Arbitration Clauses

Employers can likely avoid these issues entirely with careful drafting of their employment agreements. In particular, if an employment agreement gives an employee the opportunity to “opt out” of the agreement (thus making the agreement voluntary, not mandatory), an arbitration clause and class action waiver is likely enforceable. An opt-out clause should clearly inform the employee of their right to opt out of arbitration and also require the employee to affirmatively notify their employer of their desire to opt out. Ironically, allowing employees the option to resolve employment-related disputes in arbitration may help defend a later challenge to the enforceability of the arbitration agreement if the employee had the option to “opt out” but chose not to do so.

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