Our company suddenly require all employees to sign an Arbitration Agreement?

UPDATED: Nov 18, 2011

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UPDATED: Nov 18, 2011Fact Checked

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Our company suddenly require all employees to sign an Arbitration Agreement?

I am new to this company and most of the employees are longer than 10 years. Suddenly our company gives out arbitration to all employees to sign. We are wondering if this is legal and if any right has been violated, especially for those who are working for more than 10 years?

Asked on November 18, 2011 under Employment Labor Law, California


SJZ, Member, New York Bar / FreeAdvice Contributing Attorney

Answered 11 years ago | Contributor

It is perfectly legal. The company has the right to set the terms and conditions of employment, and to change them at any time--including adding the requirement to sign an arbitration agreement. If you do not sign, the company may fire you. If you do sign, it will be a binding contract, since receiving continued employment is more-than-adequate consideration to bind the agreement. The only exception is for employees who already have a valid employment contract (if any)--the company must honor the existing contract, which may preclude (depending on its terms) making the employee sign an arbitration agreement.

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