Supreme Court Reinforces the Ability of Employers to Mandate Arbitration
On June 23rd, 2023, the Supreme Court of the United States ruled in favor of employers in the case of Coinbase Inc. v. Bielski. In a 5 to 4 decision, the court’s conservative majority issued a decision to make it less challenging for businesses and organizations to compel arbitration. In this article, you will find an overview of the decision from the Supreme Court and the potential implications for employment law.
Case Analysis: Coinbase Inc. v. Bielski
Background & Facts
Coinbase—the San Francisco-based cryptocurrency exchange platform—faced two class-action lawsuits in a California federal district court. In the first, a user claimed a violation of the Electronic Fund Transfer Act after losing $31,039 in cryptocurrency as part of a trading strategy. The second claim filed in California court against the company alleged that Coinbase used misleading sweepstakes. In both cases, Coinbase sought arbitration based on user agreements. However, the court invalidated the arbitration agreement on the grounds that they were “too one-sided.” The 9th Circuit Court of Appeals initially ruled against the company.
The Decision By the Supreme Court
The Supreme Court ruled in favor of Coinbase in Coinbase Inc. v. Bielski, making it less burdensome for companies to compel arbitration. In a 5-4 decision, Justice Brett Kavanaugh, writing for the majority, reasoned that if district court proceedings continued while an appeal on arbitrability was ongoing, the benefits of arbitration such as efficiency, lower expenses, and less intrusive discovery would be lost. The court relied on the precedence of a 1980s Supreme Court case that ruled that it is “common sense” that any litigation is “stayed” while arbitration is pending.
Why the Case Could Have Implications for Employment Law
The Coinbase Inc. v. Bielski ruling has notable implications for employment law. It eases the process for parties, including employers, to compel arbitration. By mandating a pause in district court proceedings during an appeal on arbitrability, it safeguards the efficiencies and cost-effectiveness of arbitration. It is especially significant in employment disputes. Many employers in Florida ask workers to sign contracts with mandatory arbitration clauses.
Employment Law Agreements May Compel Arbitration in Florida (Often Enforceable)
In Florida, employment law agreements it is not uncommon for employers to include arbitration clauses. With some exceptions, pre-dispute mandatory arbitration clauses are enforceable in employment agreements in Florida. Indeed, courts in the state have historically recognized and upheld the validity of arbitration agreements in employment contracts. Though, any employment contract in Florida with a pre-dispute arbitration provision must meet certain requirements in order to be permissible in Florida. As stated previously, this ruling from the Supreme Court of the United States is likely to make it even easier for employers in Florida to compel arbitration.
Get Help From a Workplace Discrimination Attorney in Florida
Arbitration and employment law can be complicated. If you have questions about mandatory arbitration in an employment law matter in Florida, please do not hesitate to contact an experienced attorney for help with your case.