Military Leave Claims Can Be Subject To Arbitration Agreements

September 12, 2007

The U.S. District Court for the Western District of Kentucky at Louisville has held that a valid agreement to arbitrate "any" employment dispute covers claims under the Uniformed Services Employment and Reemployment Rights Act (USERRA). In Landis v. Pinnacle Eye Care, et al., a former employee brought claims alleging that he was demoted as a result of his military service in Afghanistan. His employer moved for a stay of the lawsuit based on a written agreement to arbitrate, contained in the plaintiff's employment contract. The Court considered whether or not an arbitration agreement could prevent an employee from bringing USERRA claims in court. Judge Russell cited the federal policy favoring arbitration, expressed in the Federal Arbitration Act, and decided that the arbitration agreement must be enforced. Although some courts have invalidated arbitration clauses that were procedurally burdensome to the claimant, the Court was persuaded that substantive protections were more important.

The Court found no clear Congressional intent to preclude arbitration of USERRA claims, so long as the arbitration agreement does not limit an employee's substantive rights. In this case, the arbitration agreement did not impair any of USERRA's substantive protections, so Judge Russell enforced it. The Court also held that all of the plaintiff's employment-based claims were subject to arbitration, even if those claims were being brought against individual managers who were not technically parties to the arbitration agreement.

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