Signing An Arbitration Clause As a Condition of Employment

In Strawn v. AFC Enterprises, 70 F. Supp. 2d 717 (S.D. Tex. 1999) an employee sued her non-subscriber employer for personal injuries suffered in the course and scope of employment. See id. at 719. The employer moved for arbitration based on the "Value Deal Agreement" signed by the employee as a condition of her employment. See id. Under the Value Deal Agreement, the employee agreed to submit "all claims and disputes for bodily injury" to arbitration in return for a heightened level of benefits under the employer's "Employee Injury Benefit Plan." See id. In denying the employer's motion to compel arbitration, the court rejected the employer's claim that public policy arguments made by the employee were directed to the Value Deal Agreement as a whole and not the arbitration clause. See id. at 727. The court stated that the Prima Paint rule is applicable when the existence of an arbitration agreement is in issue, not when the issue is "whether legal constraints external to the parties' agreement forecloses the arbitration of . . . claims." See id. Because the Value Deal Agreement was: (1) "an entirely separate document, not a clause contained within a larger employment contract addressing many other issues". (2) "concerned almost exclusively with establishing arbitration as the means for resolving disputes between the parties," the court construed the employee's attack on the Value Deal Agreement as an attack on the arbitration clause, thus appropriate for court resolution. See id.