Gay Grunfeld spoke in
Arbitration became popular for employers leading many employers to have mandatory arbitration agreements. However, this was not fair to employees because it was expensive for them to front expenses relating to arbitration such as the payment of the arbitrator fees. In litigation, the employee may pay for the attorney and court costs for filings, but usually the decision makers are not paid by the hour. The arbitration can easily cost an individual $25,000.
Through a series of cases, courts have forced the employers to pay for the arbitration when there are mandatory arbitration agreements. However, for the employee the decision of the arbitrator may be for the employer if the employer is paying for all the costs. Arbitration involves fact finding and differs from mediation where a fixed fee compensation for the arbitrator may work.
The advantages of arbitration is that the procedures are less formal in that there are fewer witnesses and less strict evidence rules as opposed to litigation in the courts. However, in a binding arbitration, there is no review or appeal to a higher court on the decision.
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