In one recent case, an employee signed an agreement to arbitrate a discrimination claim — then a judge let her sue her employer anyway. Here’s why:
The agreement was electronic, and the company failed to get sufficient proof that the employee actually signed it.
Here’s how the process worked:
The arbitration agreement was posted on the company’s intranet. All employees could access the intranet with a unique user ID and password.
Employees were told to read the agreement and “sign” it by entering their social security number and password, indicating they’ve read and understood the agreement. Afterward, employees received an e-mail asking them to respond if they denied that they signed the document.
So when the employee brought her discrimination claim forward, the company told her she’d already agreed to arbitrate out of court. The company had a record of her signature, and an examination of her e-mail showed she’d gotten the follow-up message and never responded.
However, she claimed she never signed it — and alleged that her manager did it for her without her permission. At one point, she said, she forgot her password and asked her manager to reset it for her. That meant the supervisor had access to her log-in information for a period of time.
The company admitted that could’ve happened and, therefore, couldn’t prove the employee had actually signed the agreement.
That was enough for the judge. Without proof, the court couldn’t force the employee to arbitrate, and the case was allowed to move forward.
The lesson: In most cases, it’s easier and safer to have legal documents signed on physical paper.
Does your company use electronic agreements? Why or why not? Let us know in the comments section below.
Cite: Kerr v. Dillard Store Services, Inc.
