Employers are attracted to mandatory arbitration in order to avoid the time demands and high costs of litigation. This can be especially attractive to small and mid-size companies which cannot spare the time and resources to devote to protracted litigation and for which a runaway jury verdict would spell disaster. Arbitrations produce a speedier result for both parties, which lets everyone get on with their lives. Arbitrations are usually decided in a matter of months, rather than the years that are normally required to obtain trial and appellate verdicts. However, while arbitration is often less expensive than protracted litigation, it is by no means cheap.
Arbitrations offer the advantage of more privacy, often of both the dispute and the resolution.
On the other hand, because arbitration is seen as easier, employees may file on inconsequential claims for which they would not sue. Significantly, plaintiff attorneys generally view an arbitration case as having a lower settlement nuisance value than a court case. Indeed, they might pass on a marginal case if limited to arbitration. Historically, some employers saw mandatory arbitration as a way to eliminate some rights or remedies that their employees would otherwise have in a lawsuit. These harsh results led to criticism by the EEOC and many courts against mandatory arbitration.