A recent case that went through the New Jersey Appellate Court demonstrates the grave importance of well-crafted agreements between employers and employees.
On October 26, the N.J. Appellate Court ruled in favor of an employee who sought to file a civil action suit against his former employer despite having signed several agreements with the employer that included arbitration clauses.
Stephen Barr worked as stockbroker for brokerage firm Bishop Rosen from 1997–2014. In 2009, a client of Barr’s filed a FINRA arbitration against Barr and Bishop Rosen alleging state and federal securities law violations and other fraudulent conduct. Barr paid for legal defense for himself and the firm, and as a result, filed a civil action against Bishop Rosen in 2014 alleging breach of contract, violations of New York wage and compensation laws, unjust enrichment, quantum meruit, and breach of Bishop Rosen’s alleged duty to indemnify him.
During his time at the firm, Barr signed agreements that contained arbitration clauses. The language of the agreements, however, was deemed too unclear to be upheld. The court emphasized that previous examples of clearly-worded arbitration clauses “reveal the ease with which parties may craft enforceable waiver clauses. The key, as the Court recognized, is clarity…”
You can read the case in its entirety here.
Byrnes, O’Hern & Heugle’s Employment Counsel
The laws and regulations that impact employer-employee relationships have become increasingly complex and difficult to adhere to. It is of the utmost importance for both employers and employees to protect their interests when entering into agreements.
When drafting noncompete agreements or restrictive covenants, for example, employers must ensure that the language of the documents is as clear as possible, and employees must be confident that they understand the content of the documents. The best way to avoid becoming entangled in litigation is to create a clear agreement in the first place with the help of an experienced attorney.
Our attorneys at Byrnes, O’Hern & Heugle in Red Bank, NJ offers counsel in many areas of employment law, including non-compete and restrictive covenants, defending wrongful termination/harassment claims, workplace training, employment investigations, and employment counseling & agreements. By keeping communication open and clear between employers and employees from the beginning, both parties can mitigate against the possibility of future disputes.