Jottings By An Employer's Lawyer

Wednesday, January 14, 2004

Employer Gets Second Shot At Enforcing Arbitration, Albeit With Different Selection Mechanism

Developing the contours of arbitration and arbitration agreements in the employment law context continue to occupy the courts. Clearly the courts as a general rule are following the pro-arbitration direction of the U.S. Supreme Court. In today's example, the 6th Circuit modifies its earlier decision throwing out an arbitration agreement because it left the selection of the pool of potential arbitrators solely to the employer. Specifically the selection clause provided:
Once an arbitration hearing is requested, the [policy] grants [the employer] the right to unilaterally select a pool of at least five potential arbitrators, each of whom must be: (1) an attorney, (2) unemployed by and unaffiliated with the company, (3) generally recognized as a neutral and experienced labor and employment arbitrator, and (4) listed on the rosters of the Federal Mediation and Conciliation Service (FMCS) or the AAA, as well as other arbitration rosters.(2) Then, counsel for the company and the aggrieved employee mutually select an arbitrator from that pool by alternatively striking names until only one remains.
McMullen v. Meijer, Inc. (6th Cir. 1/14/04). On request for rehearing, rather than tossing the agreement entirely the Court remands to the district court for consideration of whether or not the arbitration agreement should be enforced, absent the offending arbitrator selection clause. While noting that the intent of the parties is the primary consideration in making the decision on whether the offending clause can be severed, the Court notes somewhat enigmatically that
... in this context, intent is not the only consideration. Federal policy favoring arbitration may figure into the analysis, see Morrison, 317 F.3d at 675, 679-80, as may the interplay between state law and that federal policy, see id. In addition, as Morrison indicates, reliance on Chattanooga Mailers’ Union is still appropriate in cases concerning the severability of arbitration contract provisions. 317 F.3d at 678 n.22.
Clearly, a court willing to give arbitration a second shot, much as the Texas Supreme Court did in its New Year's eve decision discussed in this earlier post.


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