Cautionary Note for Kentucky Employers Regarding Arbitration Agreements

Many employers have most likely read recent references about the use of arbitration agreements with employees. The use of such agreements may be a nationwide trend (the Economic Policy Institute reports that 56% of non-union private-sector employees are subject to mandatory individual arbitration procedures).

However, employers in Kentucky must take note of a Kentucky Supreme Court case decided last September. That case is Northern Kentucky Area Development District v. Snyder, No. 2015-CA-001167, and the bottom line of the holding in the case is that employers in Kentucky may not condition employment on an applicant or employee agreeing to enter into an arbitration agreement with the employer. Such agreements are unenforceable. The basis of the court’s decision was a 24-year-old statute (KRS 336.700) which provides in pertinent part “no employer shall require as a condition or precondition of employment that any employee or person seeking employment waive, arbitrate, or otherwise diminish any existing or future claim right or benefit to which the employee or person seeking employment would otherwise be entitled…”

By |2019-02-11T10:13:41+00:00February 11th, 2019|Business Ownership, Human Resources|0 Comments