Companies really don’t like having their dirty laundry aired in public. And they’ve come up with a lot of legal tools to ensure that employee disputes never see the light of day in open court. One of them is a mandatory arbitration agreement that many workers sign when they’re hired, which requires legal matters to be handled in closed door mediation.
However, merely signing a mandatory arbitration agreement may not not enough to bar an employee from seeking justice in court, according to a Washington Court of Appeals ruling in Burnett v. Pagliacci Pizza, Inc. How the agreement is communicated to the employee is just as important as what it says in determining whether workers are bound to the document, the court determined.
That distinction was highlighted when former Pagliacci delivery driver Steven Burnett sued the pizza company in Washington State court for allegedly shorting its drivers on rest and meal breaks and pay, and Pagliacci tried to move the case to arbitration in line with company policy.
A review of Pagliacci’s policy revealed a more nuanced interpretation.
During orientation for the job, Burnett was told to sign an Employee Relationship Agreement (ERA)–which didn’t explicitly mention the arbitration agreement–in order to begin working that day. He was also told to read the employee handbook–which detailed the arbitration agreement–at home.
While Pagliacci’s arbitration agreement is clearly spelled out in the employee handbook–directing workers to first bring any issues to their supervisor and then, if that doesn’t resolve the issue, consider moving to arbitration–the court said that Burnett didn’t have a “reasonable opportunity” to understand the content of the employee handbook before signing the ERA.
Further, the court ruled that the arbitration agreement was “buried” in the employee handbook, appearing near the end of the 23-page document with no font or formatting indicating that it was a particularly important piece of information.
For those reasons, the court ruled that the arbitration agreement was unenforceable.
The case is now headed to the Washington Supreme Court, which will be tasked with clarifying the standards for mandatory arbitration agreements between workers and employers in Washington state.
Emery Reddy helps workers. Call us at if you’ve been denied access to rest and meal breaks, or you have a wage violation, workers’ comp, injury, or other employment law claim. You won’t get better advice.