EMPLOYMENT LAW - IS A CLICK OF A HYPER LINK SUFFICIENT TO AGREE TO BINDING ARBITRATION

By: Donna Russo, Esq. 

    In an unreported decision, Forsyth v. First Trenton Indemnity Company et. als. and First Trenton Indemnity Company et. als., A-5080-08T2, the Court ruled that a click on a hyper link on an employer web page addressing employer polices that included an updated arbitration policy was sufficient to constitute a waiver of litigation and consent to binding arbitration. The Appellate Division summarized the law of binding arbitration agreements. It found that such agreements are binding if there is some concrete manifestation of the employee's intent. A valid arbitration agreement is binding if "...there is a signature on the arbitration agreement or by some other explicit, affirmative expression of agreement." On the other hand, if an employee manual contains a binding arbitration clause but the employee does not sign an agreement providing for same nor otherwise give explicit indication of the intent to be bound, the arbitration provision is not enforceable. On this issue, the Appellate Division proffered the suggestion that written acknowledgment of receipt of an employee manual include a reference to the binding arbitration provisions. 


    In the case before the Court, plaintiff was a lawyer who was employed the Defendant for many years. Over the years, she met the company's annual requirement of certifying receipt, review and agreement of the defendant's Code of Conduct which included a specific provision for binding arbitration. Shortly before plaintiff was terminated, the defendant had sent an e-mail captioned "IMPORTANT - Employee Policy Update Reminder". One of the updated policies addressed the arbitration policy to clarify the relief available in arbitration and disputes covered by arbitration. Plaintiff had opened the e-mail and clicked on the hyper link. The Court rejected plaintiff's claims that she did not electronically consent to waive her rights under LAD and that she waived her rights to sue and agreed to binding arbitration. The Court found that an actual handwritten signature was not required and that an employer need not negotiate individual agreements with its workforce to implement a company-wide arbitration policy. The Court further addressed prior decisions that a click of a link on a website had been recognized as an acceptance and that the New Jersey Uniform Electron Transactions Act (UETA), N.J.S.A. 12A: 12-1 et seq. provides that an electronic signature is created by the standard click through a website process. 

    In this case, the Court did not specifically decide that plaintiff's click in and of itself was an electronic signature. Rather the Court looked at the entire record, which included past waiver of rights and binding arbitration provisions, and found that the record as a whole reflected plaintiff's voluntary waiver of litigation rights. Further, the plaintiff was an attorney for the defendant and although plaintiff's status in and of itself alter the finding of the necessity of explicit agreement to binding arbitration, the Court did consider her long time status as the company's attorney as part of "record as a whole".