Mandatory Arbitration Agreement for the United States

Mandatory Arbitration Agreement Template for United States

A Mandatory Arbitration Agreement is a legally binding contract that requires parties to resolve their disputes through arbitration rather than through the court system. Under U.S. law, particularly the Federal Arbitration Act, these agreements are generally enforceable across all states, though specific state laws may impose additional requirements. The agreement typically details the arbitration process, cost allocation, and scope of disputes covered.

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What is a Mandatory Arbitration Agreement?

Mandatory Arbitration Agreements have become increasingly common in the United States as organizations seek to manage dispute resolution costs and timeframes. These agreements, governed by the Federal Arbitration Act and state laws, provide a framework for resolving disputes outside the traditional court system. A Mandatory Arbitration Agreement typically specifies the types of disputes covered, the arbitration process, selection of arbitrators, cost allocation, and any limitations on available remedies. It's particularly valuable for employment relationships, consumer contracts, and business-to-business arrangements.

What sections should be included in a Mandatory Arbitration Agreement?

1. Parties: Identification of all parties to the arbitration agreement

2. Background: Context and purpose of the arbitration agreement

3. Definitions: Key terms used throughout the agreement

4. Agreement to Arbitrate: Core provision requiring arbitration of covered disputes

5. Scope of Arbitration: What disputes are covered and excluded from arbitration

6. Arbitration Procedures: Process for initiating and conducting arbitration

7. Costs and Fees: Allocation of arbitration costs between parties

8. Governing Law: Specification of applicable law and jurisdiction

9. Severability: Provision addressing enforceability if parts are found invalid

What sections are optional to include in a Mandatory Arbitration Agreement?

1. Class Action Waiver: Waiver of right to participate in class actions, typically used in consumer or employment agreements

2. Opt-out Provisions: Process for opting out of arbitration, commonly included in employment contexts

3. Confidentiality: Requirements for maintaining confidentiality of arbitration proceedings

4. Discovery Limitations: Specific limits on discovery processes during arbitration

5. Emergency Relief: Provisions for seeking emergency court relief while preserving arbitration rights

What schedules should be included in a Mandatory Arbitration Agreement?

1. Schedule A - Arbitration Rules: Detailed procedures and rules governing the arbitration process

2. Schedule B - Fee Schedule: Detailed breakdown of arbitration costs and fee allocation

3. Schedule C - Notice Forms: Standard forms for initiating arbitration or exercising opt-out rights

4. Schedule D - Approved Arbitrators: List of pre-approved arbitrators or arbitration organizations

Authors

Alex Denne

Head of Growth (Open Source Law) @ Genie AI | 3 x UCL-Certified in Contract Law & Drafting | 4+ Years Managing 1M+ Legal Documents | Serial Founder & Legal AI Author

Jurisdiction

United States

Publisher

Genie AI

Cost

Free to use
Industries

Federal Arbitration Act (FAA): Primary federal law governing arbitration agreements in the United States, establishing the enforceability of arbitration agreements and providing framework for their implementation

Civil Rights Act: Federal law that must be considered when drafting arbitration agreements, particularly in employment context, to ensure the agreement doesn't infringe on protected civil rights

Americans with Disabilities Act (ADA): Federal law requiring consideration of accessibility and reasonable accommodations in arbitration procedures

Age Discrimination in Employment Act (ADEA): Federal law protecting against age discrimination that must be considered in employment-related arbitration agreements

State Arbitration Statutes: Various state-specific laws governing arbitration that may impose additional requirements or restrictions beyond federal law

State Contract Laws: General contract formation and enforcement principles that vary by state and apply to arbitration agreements

AT&T Mobility LLC v. Concepcion: Key Supreme Court precedent (2011) upholding the enforceability of class action waivers in arbitration agreements

Epic Systems Corp. v. Lewis: Supreme Court decision (2018) confirming that employers can enforce individual arbitration agreements despite employees' desires to pursue collective actions

Lamps Plus, Inc. v. Varela: Supreme Court case (2019) establishing that ambiguity in an arbitration agreement cannot provide the basis for compelling class arbitration

Unconscionability Requirements: Legal doctrine requiring arbitration agreements to be both procedurally and substantively fair to be enforceable

Mutual and Bilateral Obligation: Requirement that arbitration agreements must bind both parties equally to be enforceable

Clear Language Requirement: Legal requirement that arbitration agreements must use clear and unambiguous language that parties can understand

Cost and Forum Considerations: Requirements regarding reasonable allocation of arbitration costs and selection of appropriate arbitration forum

Class Action Provisions: Considerations regarding the inclusion and enforceability of class action waivers in arbitration agreements

Severability Clause: Provision allowing remainder of agreement to survive if specific provisions are found unenforceable

Teams

Employer, Employee, Start Date, Job Title, Department, Location, Probationary Period, Notice Period, Salary, Overtime, Vacation Pay, Statutory Holidays, Benefits, Bonus, Expenses, Working Hours, Rest Breaks,  Leaves of Absence, Confidentiality, Intellectual Property, Non-Solicitation, Non-Competition, Code of Conduct, Termination,  Severance Pay, Governing Law, Entire Agreemen

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