Arbitration agreements, class action waivers, and severability: a cautionary tale

A well-drafted arbitration agreement is crucial to ensuring claims arising from an employment relationship will be resolved by final and binding arbitration and not in a jury trial. It's also an important protection against class or collective action claims. It's equally important, however, that you ensure your arbitration agreement waives only claims that can legally be waived and contains a valid, broad severability provision in the event a term is found to be unlawful.

The arbitration agreement

Josue Betancourt worked as a delivery driver for Transportation Brokerage Specialists, Inc. (TBS), from approximately February 2017 to May 2018. TBS is a "last-mile"delivery company whose primary client was online retailer Amazon.com Inc. At the start of his employment, Betancourt signed an "At-Will Employment, Non-Disclosure, Non-Solicitation, Class-Action Waiver and Arbitration Agreement."

Section 6 of the agreement was titled "Arbitration"and provided, in relevant part: "Any controversy, dispute or claim between the employee and the Company, or its officers, agents or other employees, shall be settled by binding arbitration, at the request of either party."Section 6 also stated: