TO: The Vice President FROM: Danielle Balson DATE: 25th July, 2017 SUBJECT: The Big Brain Solution General procedures or rules governing a typical arbitration proceeding A contract encompassing an agreement for arbitration of disputes usually outlines some of the fundamental aspects relating to any possible future arbitration. The procedures and rules that would be utilized in a given arbitration are usually part of the agreement (Smit & Thacher, 2013). In case an outside or third party service would be utilized for handling arbitration, the contract may provide specifications of whether the service’s already-established procedures and rules would be utilized (Smit & Thacher, 2013). As a result of the different kinds of arbitration services, and the flexibility that is usually provided to participants to draw up their preferred rules, there is no single set of procedures and rules applicable to all arbitrations (Smit & Thacher, 2013). Nevertheless, regardless of the rules or procedures used, below are some of the fundamental issues or general procedures and rules governing a typical arbitration proceeding: Number of arbitrators. The parties involved in an arbitration proceeding usually outline in the contract whether one, a panel comprised of three, or more arbitrators would rule or make decisions on their dispute (Smit & Thacher, 2013). As a general procedure or rule, the more significant and complicated an issue is, the higher the number of arbitrators would be involved. The number of arbitrators to be selected. Parties can make the decision to appoint arbitrators in various ways, including through the process of elimination, selection from a list of different arbitrators or through an agreement (Smit & Thacher, 2013). Timeliness for arbitration. Rules and procedures can establish timelines for making resolutions in a dispute, including when notices are issued, and how long the arbitration hearings last (Smit & Thacher, 2013). Evidence. Rules and procedures of evidence can be complicated in ordinary litigation processes. They are usually more relaxed in arbitration proceedings thus allowing more evidence to be put into consideration, even though there can be inadequate time for presenting and discovering the evidence (Smit & Thacher, 2013). Awards. Rules and procedures often dictate the form that can be presumed by an award, as well as any possible deadlines for decision-making (Smit & Thacher, 2013). Records and confidentiality. Rules and procedures may allow parties to receive and keep records of the arbitration proceedings and to ensure such records are kept confidential. Use of arbitration as opposed to a lawsuit in settling employment-related dispute An employer may for an employee to use arbitration as opposed to a lawsuit in settling employment-related dispute (Mathis, Jackson, Valentine, & Meglich, 2016). Many employers usually ask their workers to sign arbitration agreements, which ensures the employees give up their legal ri ...

1. TO: The Vice President
FROM: Danielle Balson
DATE: 25th July, 2017
SUBJECT: The Big Brain
Solution
General procedures or rules governing a typical arbitration
proceeding
A contract encompassing an agreement for arbitration of
disputes usually outlines some of the fundamental aspects
relating to any possible future arbitration. The procedures and
rules that would be utilized in a given arbitration are usually
part of the agreement (Smit & Thacher, 2013). In case an
outside or third party service would be utilized for handling
arbitration, the contract may provide specifications of whether
the service’s already-established procedures and rules would be
utilized (Smit & Thacher, 2013). As a result of the different
kinds of arbitration services, and the flexibility that is usually
provided to participants to draw up their preferred rules, there
is no single set of procedures and rules applicable to all
arbitrations (Smit & Thacher, 2013). Nevertheless, regardless of
the rules or procedures used, below are some of the fundamental

2. issues or general procedures and rules governing a typical
arbitration proceeding:
Number of arbitrators. The parties involved in an arbitration
proceeding usually outline in the contract whether one, a panel
comprised of three, or more arbitrators would rule or make
decisions on their dispute (Smit & Thacher, 2013). As a general
procedure or rule, the more significant and complicated an issue
is, the higher the number of arbitrators would be involved.
The number of arbitrators to be selected. Parties can make the
decision to appoint arbitrators in various ways, including
through the process of elimination, selection from a list of
different arbitrators or through an agreement (Smit & Thacher,
2013).
Timeliness for arbitration. Rules and procedures can establish
timelines for making resolutions in a dispute, including when
notices are issued, and how long the arbitration hearings last
(Smit & Thacher, 2013).
Evidence. Rules and procedures of evidence can be complicated
in ordinary litigation processes. They are usually more relaxed
in arbitration proceedings thus allowing more evidence to be put
into consideration, even though there can be inadequate time for
presenting and discovering the evidence (Smit & Thacher,
2013).
Awards. Rules and procedures often dictate the form that can be
presumed by an award, as well as any possible deadlines for

3. decision-making (Smit & Thacher, 2013).
Records and confidentiality. Rules and procedures may allow
parties to receive and keep records of the arbitration
proceedings and to ensure such records are kept confidential.
Use of arbitration as opposed to a lawsuit in settling
employment-related dispute
An employer may for an employee to use arbitration as opposed
to a lawsuit in settling employment-related dispute (Mathis,
Jackson, Valentine, & Meglich, 2016). Many employers usually
ask their workers to sign arbitration agreements, which ensures
the employees give up their legal right to sue the employer in
court over employment-related issues such as discrimination,
breach of contract, and wrongful termination (Mathis, Jackson,
Valentine, & Meglich, 2016). An employee who agrees and
signs an arbitration agreement thus offer a promise to pursue
any legal claims against his/her employer through an
arbitration, as opposed to a lawsuit and the employer has the
right of enforcing this by requiring the employer to only use
arbitration as a way of resolving any employment-related
dispute (Mathis, Jackson, Valentine, & Meglich, 2016).
Times when an arbitration clause might be invalid or
unenforceable against an employee
There are two key circumstances under which an arbitration
clause might be unenforceable or invalid against an employee,
and they include, whether the said arbitration clause is

4. applicable to the involved dispute, and whether the arbitration
clause is unenforceable or void because it is illegal,
unconscionable, or abusive (Holley, Jennings, & Wolters,
2012).
Applicability. Employees may argue that a given arbitration
clause is not applicable, or the involved dispute is not within
the scope of the arbitration clause and the employees’
employment agreement (Holley, Jennings, & Wolters, 2012).
For instance, in Hargraft Schofield LP v. Fluke, the contract of
the employee had been renewed several times. The very first
employment agreement had a compulsory arbitration clause,
with the second one having no arbitration clause, and the third
and fourth merely extending the terms of the preceding
employment agreements. The fifth employment agreement had a
clause that integrated the terms contained in all the four
employment agreements. The court ruled that the arbitration
clause in the first employment agreement was not applicable
since the second employment agreement superseded the first one
and since no allegations were made with regard to the first
employment agreement.
Enforceability. Employees also have the right of arguing that an
arbitration clause is unenforceable, regardless of its existence
(Holley, Jennings, & Wolters, 2012). For example, in Houston
v. Exigen, the employment agreement contained an arbitration
clause that required employment-related disputes to be solved

5. through binding arbitration in California. However, the
arbitration clause was not applicable to claims or disputes
relating to the misappropriation or misuse of proprietary
information or trade secrets of the employer. The Court held
that the clause was unenforceable since the existence of at-will
termination of employment corrupted the entire employment
agreement. The Court further determined that the clause was
invalid by noting that it was offensive in that it barred
employees from bringing lawsuits in the province while their
employer was still capable of pursuing its former and current
employees.
Effect that claims based on specific state or federal laws have
on arbitration provisions in employment contracts
Many employers usually perceive arbitration as an efficient and
inexpensive alternative to court litigation for resolving disputes
such as discrimination claims. While arbitration tend to be
widely embraced as an efficient alternative mechanism for
dispute resolution, courts still require arbitration agreements
that cover statutory employment claims to be procedurally and
substantively fair and conscionable to be enforced (Mathis,
Jackson, Valentine, & Meglich, 2016). Under the Federal
Arbitration Act, written agreements for arbitration are generally
valid except when contained in contracts of employment of
railroad workers, seaman, or other class or employees engaged
in interstate commerce (Mathis, Jackson, Valentine, & Meglich,

6. 2016).
However, claims based on the Equal Employment Opportunity
laws have significant effects on arbitration provisions in
employment contracts, with the Equal Employment Opportunity
Commission (EEOC) having the right to bring suit against an
employer on behalf of an employee who is party to an
enforceable arbitration agreement (Mathis, Jackson, Valentine,
& Meglich, 2016). For instance, in Waffle House, the employee
agreed that any claim or dispute regarding his employment
would be resolved through a binding arbitration proceeding. The
employee was subsequently fired and filed a petition against the
employer for discrimination with EEOC (Carper & McKinsey,
2012). When the EEOC filed a suit against the employer, Waffle
House, in a federal court, the employer argued that its
arbitration agreement precluded the EEOC from filing a suit
with the court for damages on behalf of the employer (Carper &
McKinsey, 2012).
However, the Supreme Court ruled that any arbitration
agreement between an employer and an employee cannot
eliminate the right of the EEOC, which is a non-party to the
arbitration agreement, to sue for different kinds of relief it
otherwise would have been able to pursue (Carper & McKinsey,
2012). The Court noted that the EEOC was specifically
empowered by different statutes, such as the Age
Discrimination in Employment Act and the Title VII of the Civil

7. Rights Act of 1964, to bring suit in federal court and
subsequently seek compensatory damages, back pay,
reinstatement, punitive damages and injunctive relief (Carper &
McKinsey, 2012). The court reasoned that a private agreement
between an employee and an employer cannot limit the powers
that are vested in the EEOC by the established statutes (Carper
& McKinsey, 2012).
References
Carper, D. L., & McKinsey, J. A. (2012). Understanding the
law. Mason, Ohio: South-Western Cengage Learning.
Holley, W. H., Jennings, K. M., & Wolters, R. S. (2012). The
labor relations process. Mason, OH: South-Western Cengage
Learning.
Mathis, R. L., Jackson, J. H., Valentine, S. R., & Meglich, P.
(2016). Human Resource Management. New York: Cengage
Learning.
Smit, R. H., & Thacher, S. (2013). Comparison of international
arbitration rules. Huntington, New York: Juris.