Employees who sign mandatory arbitration agreements with their employers
in connection with their employment must arbitrate all disputes with their
employers according to Florida’s Fifth District Court of Appeal. In
Hobby Lobby Stores, Inc. v. Alan Cole, the Court recently ruled that a former employee must arbitrate his wrongful
termination claim pursuant to the arbitration agreement executed by the
former employee as a condition of his employment.
Alan Cole, a former employee, sued Hobby Lobby, for wrongful termination
alleging that Hobby Lobby improperly discharged Cole in retaliation for
filing a worker’s compensation claim. Hobby Lobby moved to compel
arbitration pursuant to the arbitration agreement Cole executed as a condition
of his employment with Hobby Lobby.
The arbitration agreement stated that the parties agreed that any employment-related
dispute Cole had with Hobby Lobby, including “disputes involving
interference and/or retaliation relating to worker’s compensation,”
would be submitted to and settled by final and binding arbitration.
The trial court denied Hobby Lobby’s motion to compel arbitration,
concluding that the agreement was unconscionable. In deciding that the
agreement was unconscionable, the trial court improperly relied on California
law, which states that an arbitration agreement that is an essential part
of a “take-it-or-leave it” employment condition, without more,
However, in Florida, the “take-it-or-leave-it” nature of arbitration
agreements is not dispositive. Instead, under Florida law, courts should
consider the circumstances surrounding the execution of an arbitration
before concluding that it is procedurally unconscionable.
In looking at the totality of the circumstances, the Court found that there
was no evidence to support a finding that the arbitration agreement was
unconscionable. There was no evidence that Cole could not read the arbitration
agreement, or that Hobby Lobby pressured, rushed or coerced Cole into
signing it. The arbitration agreements terms were not hidden, minimized
or buried in fine print and Cole did not assert that Hobby Lobby made
any false representations or engaged in deceptive sales practices in order
to induce Cole into signing the agreement. Accordingly, the Fifth District
Court of Appeal, reversed the decision of the trial court and held that
the arbitration agreement was binding and enforceable.
Further, because a finding of unconscionability requires a determination
that the covenant is also substantively unconscionable, the Fifth District
Court of Appeal held that there was nothing in the nature of an arbitration
clause that rendered it substantively unconscionable. The Court stated
that all arbitration agreements waive the parties right to a jury trial
as a means of dispute resolution and, accordingly, this waiver cannot
serve as the basis for a finding of substantive conscionability.
Contact Rosenthal Law Group to guide you through the process of contacting
for and enforcing arbitration clauses.