Despite the obvious advantages of arbitration, very serious issues have arisen. Serious Issues Must Be Faced Two major points of contention are the timing of the decision to use arbitration and the terms of the arbitration program. Some employers wait until they are faced with a claim or dispute from an employee to offer the employee the option of binding arbitration. However, many employers require employees to sign an agreement to arbitrate any employment dispute as a condition of being hired or of continued employment. These are called pre-dispute agreements to arbitrate.
Critics cite the tremendous imbalance of power when employees sign agreements to arbitrate.
First, less sophisticated employees may not understand that they are waiving rights to jury trial for race, gender or similar discrimination claims that may arise years down the road. Indeed, one reason arbitration has worked so well for so many decades in the labor field is the presumed equality of bargaining power and the shared knowledge of arbitration procedures and arbitrators. Furthermore, some arbitration programs were designed to deny employees access to the very procedures that were critical to the successful prosecution of employment discrimination claims. Non-lawyer arbitrators with no expertise in civil rights law or the procedural or evidentiary rules could render decisions inconsistent with the law. Finally, the civil rights community was concerned that the rosters of some arbitration agencies lacked persons of color and women who might be more sympathetic to such claims as sexual harassment or the disparate impact of racially neutral practices.