---
title: "Arbitration Clause (Employment)"
type: Legal Term
source: https://casebriefly.com/legal-terms/arbitration-clause-employment
---

# Arbitration Clause (Employment)

An arbitration clause in the employment context is a contractual provision requiring employees to resolve disputes with their employer through binding arbitration rather than litigation in court. The Supreme Court in 14 Penn Plaza LLC v. Pyett held that a collective bargaining agreement requiring union members to arbitrate ADEA claims was enforceable, significantly extending the reach of mandatory arbitration in unionized workplaces. This contrasted with the earlier holding in Alexander v. Gardner-Denver Co., which preserved an employee's right to a judicial forum for Title VII claims notwithstanding a prior arbitration under a CBA. Courts scrutinize employment arbitration clauses for procedural and substantive unconscionability, particularly where there is unequal bargaining power, and may invalidate provisions that limit statutory remedies, impose prohibitive costs, or restrict discovery rights essential to vindicating statutory claims.

## Related Terms

- collective-bargaining
- unconscionability
- title-vii
- at-will-employment

## Related Cases

- 14-penn-plaza-llc-v-pyett
- alexander-v-gardner-denver-co

## Example

A new employee required to sign a mandatory arbitration agreement as a condition of hire later discovers she cannot bring her age discrimination claim in federal court and must instead proceed before a private arbitrator.

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Source: [Arbitration Clause (Employment) — CaseBriefly](https://casebriefly.com/legal-terms/arbitration-clause-employment)