Wyatt Employment Law Report

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Court of Appeals Refuses to Enforce Arbitration Clause

By George J. Miller

In the recent case of Hergenreder v. Bickford Senior Living Group, No. 10-1474, the U.S. Court of Appeals for the Sixth Circuit held that an employee could not be compelled to arbitrate an ADA claim against her employer when, under Michigan contract law, she had not contractually agreed to do so.  The company’s position was that she was bound to arbitrate the claim under the provisions in its Dispute Resolutions Procedure (“DRP”). However, there was no evidence that the employee had signed the DRP and little evidence she had ever seen it. The best the company could do was offer evidence that the DRP was distributed to all employees.  The employee denied that she had received it.  While the company’s employee handbook referred employees to the DRP “for details,” the handbook contained a disclaimer that it was not a contract, and everyone agreed it was not a contract. So the bottom line appears to be that employers in states in the Sixth Circuit (Michigan, Ohio, Kentucky and Tennessee) who want to force employees to arbitrate employment disputes and waive their right to a jury trial need to have employees sign a document which forms a valid contract under the law of the applicable state.