Employment Law Adr Update 1996: News for Colorado Employers
| Publication year | 1996 |
| Pages | 39 |
1996, June, Pg. 39. Employment Law ADR Update 1996: News for Colorado Employers
Four recent developments in the arena of employment law alternative dispute resolution ("ADR") deserve attention by Colorado employers. First, the Colorado Supreme Court has held that under Colorado law, arbitration agreements between employers and employees are not enforceable against claims under Colorado statutory law for unpaid wages. Second, the federal courts in Colorado have issued pro-employment ADR opinions. Third, courts outside Colorado have enforced arbitration provisions distributed as policies or in employee handbooks. Fourth, while employee advocacy groups campaign against mandatory arbitration agreements, joint panels of employee and employer representatives have released protocols for the use of ADR in employment disputes.
All of these developments provide reasons for Colorado employers and their counsel to examine the use of ADR to resolve employment disputes and to revise, if necessary, existing ADR policies and agreements.
Arbitration of employment disputes accelerated following the 1991 decision by the U.S. Supreme Court in Gilmer v. Interstate/Johnson Lane Corp.(fn1) In Gilmer, the Court rejected a variety of arguments against the use of arbitration to resolve employment disputes and held that a federal age discrimination claim was subject to a mandatory arbitration provision the employee had signed. Many employers responded to the Gilmer decision by implementing some form of ADR policy for their employees, and courts around the country began enforcing ADR provisions for all types of employment disputes. However, until late 1995, there were no published decisions by the Colorado state appellate courts concerning arbitration of employment disputes.
That situation has now changed. In Lambdin v. District Court,(fn2) the Colorado Supreme Court reversed a district court order compelling arbitration of a claim that had been brought pursuant to Colorado's Wage Claim Act.(fn3) The case arose after a terminated employee filed a lawsuit asserting claims for breach of contract and promissory estoppel, and also a statutory claim for unpaid commissions. The employer's compensation plan included an arbitration provision, and the employer filed a motion to dismiss or, in the alternative, to stay proceedings, pursuant to the Uniform Arbitration Act of 1975.(fn4) The district court granted the employer's motion and ordered a stay of the civil action pending conclusion of the arbitration proceedings. The employee then filed a petition for relief in the nature of mandamus and prohibition with the Colorado Supreme Court.(fn5)
The Colorado Supreme Court in Lambdin first concluded that there was a conflict between the Uniform Arbitration Act and the Wage Claim Act. While the court recognized that the Uniform Arbitration Act sets forth Colorado's public policy in favor of arbitration, a section of the Wage Claim Act(fn6) expressly voids any agreement that waives or modifies rights under that Act. The court reasoned that enforcing the arbitration agreement would constitute a waiver of the right set forth in the Wage Claim Act to bring a civil suit to recover unpaid wages.(fn7)
The court resolved this statutory conflict by concluding that the specific...
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