Employer’s Lawyer Explains That Arbitrators Favor Employers Out of Self-Interest

Irvine lawyer Greg Labate is quoted in the Orange County Register:

Labate advises clients to get their employees to sign arbitration agreements, waiving their right to sue in court, and sending disputes to privately hired arbitrators.

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“People question whether arbitration tends to favor employers,” Labate told a [Professionals in Human Resources Association] conference session. “I believe they do. I use the same arbitrators over and over, and they get paid when I pick them. They know where their bread and butter comes from.”


0 thoughts on “Employer’s Lawyer Explains That Arbitrators Favor Employers Out of Self-Interest

  1. Gregory Gauthier says:

    There’s another candid post from 2013 by attorney Dennis J. Alessi of Mandelbaum Salsburg about why employers should adopt arbitration clauses. The first three advantages cited are “no jury” (which he says is an advantage since juries tend to consist of employees but arbitrators have employer or managerial experience), “smaller punitive damages”, and “confidentiality” (an advantage for employers “that have public images they want to protect”, and he goes on to recommend “includ[ing] provisions which prohibit the employee, and his/her attorney, from disclosing to anyone any information about the arbitration process and any award the employee may be granted.”). The fourth advantage is “economics”, where “With the arbitration agreement requiring that the employee pay half the costs of the arbitration, this can often become a real financial burden for the employee which can force an early, favorable settlement for the employer” and “possible [statutory] shifting of the employee’s attorney’s fees and costs to the employer can be avoided by a provision in the arbitration agreement that each party has to pay its own fees and costs. In this situation, probably no attorney will represent the employee under a contingency fee arrangement (i.e. an arrangement where the attorney is paid only if he/she obtains a monetary award for the employee). The employee having to pay the attorney each month as the case proceeds will obviously create another financial burden which can lead to an early and favorable settlement for the employer.”
    I assumed when I read the article that it was just a parody written by someone opposed to mandatory employment arbitration, but the author appears to be serious. http://hr.blr.com/HR-news/Unions/Unions/zn-Why-employers-should-have-arbitration-agreement

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