On June 10, a unanimous decision of the U.S. Supreme Court clarified the standard of review federal courts will use when reviewing an arbitrator’s decision about whether parties contemplated class arbitration when they entered into a broadly worded mandatory-arbitration provision. Though the case involved an arbitration provision outside the employment context, this decision has implications for employers using mandatory arbitration agreements in employment contracts and other agreements with employees.
Based on the Court’s holding in this case, which essentially eliminates federal court review of an arbitrator’s decision regarding whether an arbitration clause permits class arbitration, employers should reevaluate their current mandatory arbitration language to ensure that the company’s intent is explicit. (Oxford Health Plans LLC v. Sutter.)
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