• Uncategorized

Arbitration Agreements for Non-English-Speaking Employees, Quirky Question # 110

Quirky Question # 110:

Our company utilizes a mandatory arbitration policy for our employees.  In essence, our employees are required to arbitrate any claims relating to their employment relationship.  As is true for many other companies, our workforce has become increasingly diverse, and now includes many employees for whom English is a second language.  If we sought to enforce our arbitration agreement against someone with limited English language skills, would we encounter any problems?

Dorsey’s Analysis:

I apologize for offering an equivocal answer to your question about whether an arbitration agreement, written in English, could be enforced against someone with limited English-language skills, but, it depends.  Let’s start with two basic principles.  First, the Federal Arbitration Act (FAA), and the decisions interpreting that statute and parallel state statutes, make clear that courts favor the enforcement of arbitration agreements mutually agreed upon by the parties.  See, e.g., Moses H. Cone Mem’l. Hosp. v. Mercury Construction Corp., 460 U.S. 1, 24 (1983) (noting the “liberal federal policy favoring arbitration agreements”).

Second, arbitration agreements are contracts.  As such, they must meet the requirements of any other valid contract – offer, acceptance and consideration.  For contracts to be enforceable, there must a “meeting of the minds”; in other words, an agreement as to the nature and content of the contract.  If one party’s English-language skills are so limited that he/she cannot understand the offer being made, it is difficult to understand how he/she could agree to, or “accept” the contract terms.

As the last paragraph suggests, the key question, therefore, is just how “limited” are the language skills for your employees with “limited English language skills”?  Can they understand any English?  If not, how do you communicate with them regarding other important workplace policies?  Are your employees predominantly of one minority group who speak the same language (e.g., Hmong, Hispanic, etc.) or is your workforce a melting pot of various ethnicities, races, cultures, and languages?  If the former, do you have translators available to communicate with those whose English-language skills may be less well developed than their peers?  Or, can one or more of your employees who language skills are better translate policies or work directions for those whose language skills are poor?

The underlying theme of these observations is that your policies (including, but not limited to, your arbitration policies) need to be understandable to your workforce.  Early in this Blog’s existence, I wrote about the analogous context of whether sexual harassment policies needed to be understandable to a teenage workforce (check out Quirky Question # 12, accessible by using the “View by Topic” tab on the upper left hand corner of this page and scrolling down to the subject of ‘Sexual Harassment.’)  In that analysis, I pointed out that important workplace policies needed to be understandable by those in the workforce if an employer hoped to enforce the policies successfully.  Moreover, within reason, the policies needed to be tailored to the nature of the workforce, e.g., a workforce composed largely of teenagers.  The same general principles apply here.

Here are six practical suggestions for your consideration that should enhance the enforceability of your company’s arbitration policy.

First, consider producing your company’s most important policies, including your arbitration policies, in multiple languages.  If you suspect that a number of your employees do not understand your company’s policies due to their limited English-language skills, you should consider producing at least your most important policies in other languages.  The practicality of this approach will be influenced by the diversity of your workforce, the number of native languages spoken, the associated costs, etc.

Second, if you do not want to incur the costs associated with reproducing your policies in multiple languages, consider including a brief statement at the start of your policies (whether in an employee handbook or in other documents) that is written in multiple languages.  The statement could state simply something along the lines of: “The following Employee Handbook is written in English.  If, for any reason, you are unable to read the Handbook, please inform your HR representative as soon as possible.  If you inform an HR representative that you are unable to read the policies or do not understand them, we will assist you to read and understand the policies.  If you do not inform an HR representative that you need assistance, we will assume that you can read and understand the policies.”  Of course, you then need to follow through appropriately if one of your employees apprises you that he/she cannot read or understand your policies.

Third, as an alternative to publishing your policies in more than one language, consider using a translator to help certain members of your workforce understand your policies.  In connection with this effort, ensure that your employees execute an acknowledgement form, in their native languages, stating that they have had the policies translated and explained to them.  (An interesting question, beyond the scope of this analysis, is whether an employee who signed an arbitration agreement and who was hired based on his/her execution of that document, would need to be provided any additional consideration if you later determined that he/she did not originally understand what he/she was signing.)

Fourth, consider training all of your employees periodically with regard to your company’s policies.  As you conduct this training, ensure sufficient interaction with your employees to ascertain whether they are able to understand your policies as written.

Fifth, (and I confess to some reservations about this next option), consider training a subset of your employees, i.e., those whose English-language skills are suspect.  Depending on the size of your workforce, you could consider having a HR representative meet with these employees to ask them about several of your most important company policies, including your arbitration policy.  (Three admonitions with respect to this approach.  1)  Undertake this effort carefully and diplomatically.  2) Explain carefully to the affected employees the legitimate purpose of your inquiries, so this group does not feel discriminated against or mistreated in any way.  3)  Ensure that the company does not take any adverse action against those whose understanding of your policies may be limited due to deficiencies in their English-language skills.)

Sixth, regardless of how you approach all of the recommendations set forth above, ensure that your key policies are not buried in a lengthy handbook or other document.  Display them prominently.  Where appropriate, use separate acknowledgement forms for each important policy.

In a recent decision by the United States District Court for the District of Maryland, Oumar Dieng v. College Park Hyundai, Civil Action No. DKC 2009-0068 (July 9, 2009), the District Court addressed a number of issues involved in the enforceability of arbitration agreements, including whether the agreements were enforceable as to employees whose English-language skills were limited.  Unfortunately, the Court’s opinion does not shed much light on the issue because the Court concluded, with little explanation, that while English was not the first language of the plaintiffs, “all Plaintiffs are fully capable of speaking, reading and writing in English.”

The plaintiffs in Dieng claimed that they were not paid the commissions for vehicles they sold and were required to work in excess of 40 hours per week without receiving overtime compensation.  Plaintiffs sued for violations of the FLSA, the Maryland Wage Payment Statute, and common law claims.  The Defendant auto dealer moved to compel arbitration based on the arbitration clause set forth in the employee handbook.  The Court granted the Motion to Compel notwithstanding the plaintiffs’ claims that the agreement: a) lacked consideration; b) lacked mutuality; c) was unconscionable both procedurally and substantively; and d) was void as against public policy.  (I won’t discuss the ways in which the Court dealt with each of the arguments advanced by the plaintiffs but they all were rejected by the Court.  If your company is confronting any of these issues, however, you might find the opinion an interesting read.)

The lack of English fluency played out in the procedural unconscionability argument.  The plaintiffs argued that because English was not their first language, they needed time to consult with counsel prior to executing the arbitration agreement.  Similarly, plaintiffs argued that the defendant failed to explain how arbitration worked or how their rights would be affected under the agreement.  The court rejected these arguments, noting, “In its simplest terms, Plaintiffs argue that they should not be held to an agreement that they signed, but not have or take the time to read and understand.”  The court pointed out that the arbitration provision was on the second page of a two-page document, and was written in bold, underlined and CAPITALIZED lettering.  Given the prominence of the arbitration provision and the Court’s perception that although English was not the native language of the plaintiffs, they all were capable of reading and understanding English, the Court was not persuaded by the plaintiffs’ arguments.

The Dieng opinion does not provide much insight into how the issue might have been resolved if the plaintiffs truly were not able to read or understand English.; But, as referenced in the recommendations above, the decision does highlight another way in which an employer can insulate itself from a challenge to the arbitration agreement – display it prominently and clearly, and have the employees acknowledge reading and understanding the document. Another option available to employers, but not discussed by the Court, would be to provide prospective employees with a copy of the arbitration policy several days in advance of their hiring, with encouragement that they seek legal guidance or other assistance to read and understand the policy. Taking these steps should ensure that an otherwise valid policy is not subject to challenge.

Dorsey & Whitney

Dorsey is a business law firm, applying a business perspective to clients' needs. We make it our first priority to know the context in which you do business - your market, your competitors, your industry.

You may also like...