The Appellate Division enforced an arbitration agreement entered into by the employer and a service manager for discrimination and whistleblower claims in Wagner v. Open Road Auto Group, No. A-5312-10T3 (App. Div. Jan. 10, 2012).

After the employee began employment, he signed a one-page arbitration agreement.  Two years later the employee was terminated and filed a complaint alleging violations of the New Jersey Law Against Discrimination as well as the Conscientious Employee Protection Act.  The lower court denied the employer’s demand for arbitration because the arbitration agreement did not specifically state that it covered claims arising from termination of the employment relationship.

 After reviewing prior cases where arbitration was denied based upon the language of the arbitration agreement, the Appellate Division found for the employer because the agreement specifically included claims of harassment and discrimination, despite its failure to specifically include claims related to employment termination or retaliation.

 When properly drafted, an arbitration agreement can require an employee to arbitrate any claims with regard to the employment relationship.  Arbitration can be beneficial to employers in that it is generally a faster and more efficient way to resolve employment issues.  However, this case demonstrates that without proper drafting, an arbitration agreement may be ineffective in requiring arbitration of all claims.