Cisco Systems, the California-based technology company, recently received a blow when a San Francisco judge ruled that a former employee with an age discrimination suit is allowed to pursue action against the company through the courts. Upon hiring, Cisco required employees to complete a large amount of standard paperwork, including an agreement they called a Proprietary Information & Invention Agreement. The document detailed how employees should handle all proprietary information, with a statement embedded in the fifth page that says any labor disputes will be forced into binding arbitration. Upon being hired, the employee signed the agreement, along with a stack of others, assuming the document stated the obvious. After being forced to file suit against the company for age discrimination, Cisco attempted to force the woman into arbitration. Her attorney took the matter to court and a judge ruled that Cisco’s bizarre placement of the binding arbitration requirement was an attempt to conceal a controversial policy.
Obama & the Courts vs. Arbitration Clauses
In 2014, former President Obama ordered that all companies with $1 million plus in federal contracts eliminate arbitration clauses that require agreement before any conflict has happened. In other words, having an arbitration clause in new hire paperwork was deemed by the President to be illegal.