An Actual Arbitration Agreement Is Required for Enforcement

An employer could not enforce an arbitration agreement, purportedly requiring its employees to arbitrate any work-related disputes, where it could not produce a signed copy of the agreement, according to the U.S. Court of Appeals for the D.C. Circuit.

In Camara v. Mastro’s Restaurants LLC, the employee brought claims under the Fair Labor Standards Act, and the employer sought to compel arbitration. The employer, however, could not produce an agreement that had been signed by the employee, and the employee denied signing it. The party seeking to enforce an arbitration agreement has the burden of proving the other party agreed to arbitrate. An affidavit from the restaurant general manager stated that they required all employees to sign such agreements, personally presented each employee with the agreement, and “virtually every” employee had signed one. The HR manager submitted an affidavit that the electronic HR system noted that the employee had signed the agreement. Yet, because the employee denied doing so and because the actual agreement could not be produced, the court found that the employer failed to meet its burden of proof. Moreover, his continued employment could not be construed as implied agreement to arbitrate where there was no evidence that he knew of the agreement’s existence.

The lesson for employers is quite simple – make sure you have copies of signed agreements.