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$2 million award for employee
June 24, 2006 by Ross Runkel at LawMemo

An arbitration panel awarded over two million dollars to an employee who was fired by UBS Financial Services. The case illustrates some trends, according to Professor Richard Bales.

Details at Workplace Prof Blog - Employee Wins Big in Arbitration; Court Restricts Employer's Ability to Claim Arbitral Bias.

The trends according to Bales, followed by my reactions:

1. Arbitrators are not necessarily stooges, and often find in favor of employees, and award large damages.
• Reputable arbitration providers such as AAA, NASD, and JAMS/ENDISPUTE work hard to provide neutral arbitrators. As for how "often" they award in favor of employees, this is not a useful observation without looking at the merits of individual cases. (The same is true of cases that are litigated.)
2. Employees are increasingly less likely to challenge the enforceability of arbitration agreements.
• Probably true. The grounds for court challenges of arbitration agreements are quite narrow, so why would an employee spend a lot of money on a sure-to-lose challenge?
3. Employers are increasingly challenging awards that went in favor of the employee.
• Of course. Employers challenge court decisions in favor of employees, so why not challenge arbitration awards? (This trend should end soon, as employers learn how hard it is to overturn an arbitrator, and as courts begin awarding sanctions for non-meritorious challenges.)
4. Most big-win cases are brought by employees who are highly-paid white males in the securities industry .
• Of course. The same is true in court cases. High-paid employees have more money at stake. White males, on average, are more likely to be high-paid.
5. "So, even if these cases demonstrate that employees can win in arbitration, they don't necessarily demonstrate that employees who the antidsicrimination laws most seek to protect can win consistently."
• Assuming that the antidiscrimination laws were designed mostly to protect low-paid employees who are not white males, I see no reliable evidence that they do better in court than in arbitration. And, I don't think "win consistently" is a useful benchmark. The overall win-loss statistics always ignore the merits of individual cases.

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