New York Labor and Employment Law Report
Jury Waivers: A Viable Alternative to Arbitration Agreements
November 4, 2011
By: James J. Rooney
Over the past couple of decades, there has been much debate over whether arbitration agreements can be used to prevent employees from asserting discrimination and other employment-related claims in court. Lost in this debate, however, is a simpler and perhaps more reliable means of managing an employer’s risk: a jury waiver. A jury waiver is nothing more than a contractual provision in which an employee waives his or her right to a trial by jury in a legal proceeding brought against his or her employer. Such a provision is most commonly found in an employment agreement that is entered into when an employee is hired, but the agreement can be entered into at other times, such as when the employee obtains a raise or promotion.
Many employers assume that a jury waiver cannot be enforceable. We are, after all, trained from an early age to believe that we have a constitutional right to a trial by jury. In large part, that belief is accurate. The right to a jury trial is embodied in both the United States and New York Constitutions. And yet, the case law is generally clear that a jury waiver, if properly written and entered into, can have the effect of surrendering an employee’s right to a jury trial.
The more pressing question, then, is not whether a jury waiver is valid, but whether employers should take advantage of this opportunity. Similarly, is a jury waiver preferable to arbitration? Both jury waivers and arbitration agreements help avoid the danger and unpredictability of a jury trial, but there are some distinct advantages to jury waivers. Maybe the most obvious advantage is that, by keeping the process in the judicial system, a jury waiver allows the employer to exercise all of its formal, procedural rights, including the right to conduct discovery; the right to file a motion asking for the dismissal of the case; and the right to pursue a meaningful appeal. Anyone who has been through litigation knows that these tools can be powerful weapons for a defendant.
Detractors of jury waivers may respond by arguing that arbitration is cheaper and less time-consuming. In many instances, they are correct. However, most lawyers would agree that arbitration has become more protracted and expensive in recent years. Although it may still be a cheaper alternative to judicial litigation, that advantage is not as clear-cut as it was in the past. This is in no small part due to the fact that arbitration agreements are often challenged in court. In fact, the litigation over the enforceability of an arbitration agreement can be so costly and time-consuming that it often defeats the purpose of arbitration altogether.
Regardless, those employers who are considering the use of jury waivers must be aware of the best manner in which to frame such a waiver in order to enhance its chances of being held enforceable. The courts have made it clear that a jury waiver must be “knowing and voluntary” in order to be enforceable. As such, a waiver is more likely to withstand challenge if it contains specific references to the statutes for which a jury demand is being waived (e.g., Title VII of the Civil Rights Act of 1964, the Americans with Disabilities Act, etc.). On the other hand, if the waiver is buried in a lengthy, complex contract or is being forced upon an unsophisticated employee who is unlikely to appreciate the waiver’s implications, a court will be less inclined to find that the waiver is truly “knowing and voluntary.” An employer should therefore ensure that the agreement is carefully drafted to make clear the nature and scope of the jury waiver.
Ultimately, although often ignored as a possibility, jury waivers are a viable option for many employers. The state and federal courts have upheld their validity. Accordingly, despite all of the attention given to arbitration agreements, many employers would be well-advised to carefully consider the advantages of a jury waiver instead.