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Lorber: Arbitration good for companies and workers

Lawrence Z. Lorber  

CNN: What impact will Wednesday's Supreme Court decision have on companies and workers?

Lorber: Well, I think the obvious is the Supreme Court gave a bright green light to pre-employment dispute resolution arbitration agreements. Because of that, my guess [is] there's going to be a growth in the use of these types of plans and programs to try to bring some coherence to the whole employment picture.

It's become pretty incoherent. I think over the last 10 years it's the single largest growth area in federal civil court filings. If you combine both civil rights and employment cases, it's almost 25 percent of all new federal court filings, which is incredible. And you're getting the courts being jammed, federal and state, with employment cases. And they go to the back of the line; criminal cases go first.

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CNN: Do you expect this to save businesses time and money?

Lorber: It really is a time saver. We do represent the U.S. Chamber, but it's a time saver for everybody. I mean, employees who want to see if they should have been promoted or not, having to wait three years to get their cases heard in federal court doesn't help anyone. For employers, it hopefully will represent a significant savings in costs, not to employees, but for lawyers, to be candid with you, and the transaction costs of dealing with litigation matters are becoming exorbitant.

So, I think you will find speed, efficiency and reduced cost in resolution of these matters, and that certainly benefits employers, but I think it would also benefit employees.

CNN: What about some workers' concern about the fairness of the arbitration process?

Lorber: The Supreme Court made it clear today as it did in other decisions that arbitration agreements which don't provide the same rights and remedies that an employee would otherwise get in court would not be upheld. It said that expressly today, it has said that expressly before. So I think the fear that these types of programs are going to take away rights are simply unfounded.

I don't know that it's a benefit to wait in line in court. That really has to be emphasized. In New York City, for example, it will take almost three years to have your case heard in court, if you're lucky. It's an extraordinarily long process, and to say that that's a benefit is something that I, very candidly, don't buy. It's a benefit to the lawyers, I'll tell you that. But it's not a benefit to the employees, and it's certainly not a benefit to employers.

If you look to the last few pages of the majority decision, you're going to find that it clear the court understood that it makes sense to have employment issues resolved expeditiously. It also made it clear that you cannot sign away your legal rights.

CNN: So if arbitration does not favor an employee, the worker can challenge the process in court?

Lorber: This gives finality to the arbitration process. As long as your basic rights that a statute provides, and remedies that a statute offers, are preserved, then the statute is final. As long as the arbitration programs are designed properly in compliance with the Supreme Court decision, the ability to challenge arbitration goes away.

CNN: Do think companies will change their arbitration programs in response to the decision to avoid challenges?

Lorber: Oh yes, I would think so. I mean, the law has been clear in most federal circuits anyway. Even in California the state courts have set up a system by which they can uphold arbitration programs, as long as the program was fair. I think what's happened today is that the Supreme Court underlined that.

The other thing that I would point out is that in the data we presented in our brief, and that the chamber has found out, is that employees win arbitrations more often than they win court decisions. The notion that this is a setup is just not true. Employees are more successful in an arbitration situation.

If you have an experienced arbitrator, they'll know what happens in the workplace. And the notion that employees lose these things is not true. What does happen is that you don't get the very rare, but certainly publicity-wise, out-of-sight, runaway jury verdict.

So, the legal lottery aspect of employment litigation is taken away, but the notion that employees are going to lose is just not so. The only people who may lose are litigation lawyers, and even though I'm one of them, I don't know anyone who's going to cry for employment lawyers.



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