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Are Employment Arbitration Agreements Enforceable?

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Many employers compel employees to sign arbitration agreements as a condition of employment, in an attempt to prevent their employees from filing employment discrimination lawsuits against them. Such arbitration agreements purport to deprive employees of their right to seek a trial by jury. But arbitration agreements are not always enforceable.

A Suffolk County Superior Court judge in Massachusetts recently found arbitration agreements that Grubhub forced its delivery drivers to sign to be invalid and unenforceable. In Archer v. Grubhub, the plaintiff employees alleged that Grubhub committed various violations of the Massachusetts Tips Act, the Massachusetts Minimum Wage Act, and the Massachusetts Wage Act. Grubhub moved to dismiss the employees’ lawsuit, arguing that the lawsuit was barred by the employees’ arbitration agreements.

The Massachusetts court denied Grubhub the relief it sought in a January 11, 2021, Order, holding that the arbitration agreements were unenforceable due to an exemption in the Federal Arbitration Act for workers engaged in interstate commerce. The court found that the employees, while working as delivery drivers for Grubhub, regularly transported to customers, with Grubhub’s knowledge and consent, not only prepared meals from restaurants but also prepackaged food items such as bottled soft drinks and chips, as well as non-food items such as toilet paper and personal care products. Most of the prepackaged food items and non-food items that the employees delivered were manufactured outside of Massachusetts. The Court determined that the delivery drivers thus qualified as “workers engaged in foreign or interstate commerce” for purposes of the Federal Arbitration Act, finding that the delivery drivers’ function in physically transporting products made outside Massachusetts to their final destinations in the hands of consumers rendered the delivery drivers “transportation workers” engaged in interstate commerce, within the meaning of the applicable Federal Arbitration Act exemption. The court’s ruling allowed the employees’ lawsuit to proceed, the arbitration agreements notwithstanding.

If you have questions about whether your employer is honoring your employee rights, you should consult an experienced employee rights attorney such as Benjamin T. King of Douglas, Leonard & Garvey. Attorney King has been ranked in the top 5 % of New England attorneys representing employees in employment discrimination cases, continuously since 2014.