Texas Appeals Court Requires Garment Worker to Arbitrate Workers’ Compensation Claim

Jury trials and even bench trials can be expensive, and the results can be unpredictable. Therefore, alternative dispute resolution techniques, such as mediation and arbitration, have become more popular in recent years as a means of resolving disputes, including Texas employment law cases. Sometimes, both parties will agree to arbitrate or mediate, but one party may be able to compel such a resolution based on a document signed in advance of the dispute by the other.

Facts of the Case

In a recent case, the appellant was a garment manufacturer who sought arbitration of a dispute concerning injuries that the appellee, a sewing machine operator, allegedly sustained at work. According to the employer, the employee signed a “receipt and arbitration acknowledgement” when she began her employment in 2011. The employee maintained that she did not specifically remember signing any documents pertaining to arbitration and that she had been misled into believing that the arbitration document was “not important” and was “only routine.” The employee also claimed that she had several learning disorders and that her reading ability was below the second grade level.

After the employee filed suit against the employer in a Texas trial court, the employer filed a motion to compel arbitration. The trial court denied the employer’s motion, and it appealed.

Outcome of the Case

The Court of Appeals for the Eighth District of Texas reversed and remanded the case to the trial court with instructions that an order compelling arbitration be entered. Although the employee argued on appeal that the Federal Arbitration Act was inapplicable and that the arbitration agreement at issue was unconscionable, unenforceable, and in violation of the Texas Labor Code, the appeals court found that the employer was entitled to arbitration of the employee’s work injury claim.

Since the employer regularly engaged in interstate commerce, the appellate court found that the Federal Arbitration Act was applicable to the arbitration agreement signed by the employee. The court also sided with the employer on the issues concerning possible defenses to enforcement of the agreement, ruling that the employer had established the existence of a legally valid agreement to arbitrate the employee’s work-related injury claim. In so holding, the court noted that the Texas Supreme Court ruled in a previous case that the Federal Arbitration Act did not violate the 10th Amendment to the United States Constitution by allegedly encroaching upon a state’s power to engage and regulate its own workers’ compensation system.

Speak with a Texas Employment Attorney

If you have a business or employment question, you can rely on Key Harrington Barnes for the accurate, up-to-the-minute legal advice that you need. For an appointment with one of our seasoned employment attorneys, call us at 214-615-7925. We will be glad to set up a consultation to discuss your situation. We serve business clients throughout the greater Dallas area. Since timeliness can be an important issue in employment litigation, it is important that a would-be litigant contact counsel as soon as possible after learning of a possible legal dispute or claim.

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