Is it the 'Real Thing'? How Coke's One-Way Binding Arbitration May Bridge the Divide Between Litigation and Arbitration
64 Pages Posted: 11 Sep 2009 Last revised: 24 Feb 2010
Date Written: 2009
Although the scholarly literature is replete with discussion of the pros and cons of mandatory arbitration and civil litigation, relative to one another, there has been no examination of one-way binding arbitration as a potential bridge between these procedural poles. The goal of this article is to fill that void. One-way binding arbitration requires an employee to use arbitration to resolve workplace disputes, but also gives the employee, but not the employer, the option of rejecting the arbitrator’s decision. In the event the employee is not satisfied with the outcome of arbitration, she can still pursue her claim in court. This collaborative alternative may help to alleviate workplace conflict. Employees today are stuck between a rock and a hard place. On the one hand, they are increasingly forced to sign pre-dispute arbitration agreements as a condition of employment. Employees are bound by arbitration – an alternative to civil litigation that often does not offer the full panoply of procedural protections. On the other hand, workers seeking relief from the federal court system for employment claims are increasingly finding the system inhospitable to their claims. While the federal courts offer more robust procedural protections than arbitration, they pose obstacles of their own, such as administrative agency backlog, more rigorous pleading requirements, and high dismissal rates. This has put employees in a bind, requiring the consideration of fresh alternatives. A promising and unique alternative is one-way binding arbitration. This unilateral arrangement – voluntarily adopted by The Coca-Cola Company, is a groundbreaking and novel approach to promoting arbitration, while also protecting employee choice and access to the court system. Companies can enjoy all of the benefits of arbitration – such as efficiency, privacy, costs savings and litigation avoidance – while supporting the due process rights of workers and bolstering workplace relations that may enhance profitability. The legal system also profits from arbitration arrangements that relieve administrative and judicial caseloads, promote settlement and reconcile competing dispute resolution systems. One-way binding arbitration has its own limitations, which requires that important safeguards be used. However, given its transformative potential, employers and employee advocates should consider it as an alternative to compulsory binding pre-dispute arbitration. One-way binding arbitration offers society another option along the continuum between mandatory, pre-dispute arbitration and civil litigation – providing society with a compromise that seeks to balance the benefits of both worlds and reconcile their differences. This article is part of a series examining the impact of procedure on civil rights. See Suzette M. Malveaux, Statutes of Limitations: A Policy Analysis in the Context of Reparations Litigation, 74 Geo. Wash. L. Rev. 68 (2005) and available at http://ssrn.com/abstract=1484804; and Suzette M. Malveaux, Fighting to Keep Employment Discrimination Class Actions Alive: How Allison v. Citgo’s Predomination Requirement Threatens to Undermine Title VII Enforcement, Chap. 4 in Employment Class and Collective Actions (Estreicher, Samuel & Sherwyn, D., Editors, 2009 Kluwer Law International), reprinted from 26 Berkeley J. Emp. & Lab. Law 405 (2005) and available at http://ssrn.com/abstract=1484761.
Keywords: One-way binding arbitration, Coke, Coca-cola, compulsory pre-dispute arbitration, employment discrimination, Federal Arbitration Act, Twombly, Arbitration Fairness Act, EEOC
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