Chapter 6 - § 6.2 • ARBITRATION OF EMPLOYER-EMPLOYEE DISPUTES

• Jurisdiction: Colorado

§ 6.2 • ARBITRATION OF EMPLOYER-EMPLOYEE DISPUTES

Employer-employee arbitration was well-developed long before arbitration generally became popular. Many of these arbitrations are pursuant to collective bargaining agreements.

There are principles of law applicable to labor arbitrations that are not commonly applicable to arbitrations generally. Labor arbitrations are beyond the scope of this book, although they are well defined by Colorado and federal case law and by the many articles written on the topic.¹

There are numerous cases dealing with the arbitrability of employee claims against an employer. The arbitration agreement may be in a collective bargaining agreement, an employee handbook, or a specific employee-employer agreement. The context of the issues presented by these agreements encompasses the full range of employee-employer litigation. The scope of the issues as to arbitrability is too broad to be covered in this book. A few of the issues, however, can be noted:

• Binding effect of arbitration clauses in handbooks;²
• Arbitration procedures as cost prohibitive;³
• Whether a collective bargaining arbitration provision is a waiver of employees' statutory rights before a judicial forum;⁴
• Whether Title VII rights can be governed by arbitration provision;
• Whether a signature is needed where the arbitration clause is in employee handbook;⁵
• Lack of mutuality of arbitration provisions;⁶
• Contractual statutes of limitations;⁷
• Allocation of costs as affecting validity of an arbitration clause;⁸ and
• Take-it-or-leave-it basis of an arbitration clause as affecting the arbitration clause.⁹

For additional authority, see

• Annot., Enforceability Under the Federal Arbitration Act of Arbitration Clause Not Within Collective Bargaining Agreement with Respect to Claims Under Fed. Civil Rights Statutes, 39 A.L.R. Fed.2d 253.
• Annot., Vacating on Pub. Policy Grounds Arbitration Awards Reinstating Discharged Employees, 142 A.L.R. Fed. 387 and 112 A.L.R.5th 263.
• Annot., Enforceability of Arbitration Clauses in Collective Bargaining Agreements as Regards Claims Under Federal Civil Rights Statutes, 152 A.L.R. Fed. 75.
• Annot., Vacating Arbitration Awards as Contrary to Nat'l Labor Relations Act, 147 A.L.R. Fed. 77.
• Annot., Binding Precedential Effect of Prior Arbitrator's Construction of Provision of Collective Bargaining Agreement upon Subsequent Arbitrator Construing Same Issue Affecting Other Parties, 121 A.L.R. Fed. 487.
• Criswell, "The 'Mandatory' Arbitration of Employees' Statutory Claims," 30 Colo. Law. 71 (Nov. 2011).

§ 6.2.1—Under The Federal Arbitration Act

Section 1 of the Federal Arbitration Act (FAA) defines the scope of application of the FAA, and specifically exempts contracts of employment of seamen, railroad employees, or any other class of workers engaged in foreign or interstate commerce. However, the U.S. Supreme Court has interpreted that exclusion very narrowly.¹⁰

In Lenz v. Yellow Transportation, Inc.,¹¹ the employer moved to compel arbitration of an employee's claim of wrongful termination under the Iowa Civil Rights Act. The arbitration agreement covered all employment-related disputes and provided that the FAA applied. The employee defended on the basis of the exclusion in FAA § 1, asserting that the employer was in the transportation industry and that the employee was directly engaged in interstate transportation. The Eighth Circuit compelled arbitration, rejecting that the employee and the agreement were within the transportation exemption:

• The

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