Arbitration Policy

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									Arbitration Policy
This Arbitration Policy requires any disputes that may arise between an employer and
an employee to be settled through neutral binding arbitration. Arbitration is a popular
form of alternative dispute resolution that can be quicker and cheaper than a bench or
jury trial. In addition, this policy includes an arbitration agreement that both parties must
sign in order to for the agreement to be binding. This policy is ideal for small businesses
or other entities that want disputes to be settled through neutral binding arbitration.
                                        ARBITRATION POLICY

We at ___________________ [Instructions: Insert the Company’s name] (hereinafter referred
to as the “Company”) have established this Arbitration Policy to provide formal guidance to
employees regarding Company’s position with respect to employment disputes and the use of
binding arbitration to resolve such disputes.

Although Company hopes that employment disputes with its employees will not occur, Company
believes that when these disputes do arise, it is the best interest of all concerned to resolve them
expeditiously and cost effectively. As such, Company has instituted this mandatory binding
arbitration policy, which requires, as a condition of employment at Company, each employee to
execute the enclosed arbitration agreement.

Enclosure




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                                   ARBITRATION AGREEMENT

THIS ARBITRATION AGREEMENT (hereinafter referred to as the “Arbitration
Agreement”) is hereby made and entered into as of ___________________ [Instructions: Insert
the date of this agreement] by and between _____________________ [Instructions: Insert the
Employer’s       name]     (hereinafter   referred    to   as   the    “Employer”),      of
_________________________________ [Instructions: Insert the Employer’s address] and
__________________ [Instructions: Insert the Employee’s name] (hereinafter referred to as
the “Employee”), of __________________________. [Instructions: Insert the Employee’s
address]

WHEREAS, Employer and Employee entered into an employment agreement dated
_________________ [Instructions: Insert the date of the employment agreement between
the parties] (hereinafter referred to as the “Agreement”) with respect to Employer employment
of Employee; and

WHEREAS, the parties agree that the terms of this Arbitration Agreement are integral to
Employer employing Employee pursuant to the Agreement, and desire to clarify the each party’s
rights and remedies with respect to the Agreement with the terms of this Arbitration Agreement.

NOW, THEREFORE, in consideration of the mutual covenants and agreements set forth
below, it is hereby covenanted and agreed by the parties as follows:

1.       ARBITRATION

         a.      It is understood by the parties hereto that any controversy between Employer and
Employee involving the construction or application of any of the terms, provisions or conditions
of the Agreement or Employee’s employment by Employer shall be determined by submission to
arbitration on the written request of either party served on the other. This paragraph shall apply to
any claim, including without limitation any claim by Employee of employment discrimination
under federal or state law. Upon the written request of either party for arbitration of such a claim
pursuant to this paragraph, Employer and Employee shall both be deemed to have given up their
constitutional right to have any such dispute decided in a court of law before a jury, and instead
are accepting the use of arbitration.

        b.     All arbitration commenced pursuant to this Arbitration Agreement shall comply
with and be governed by the provisions of ___________________ [Instructions: Insert the act
name and sections] [Comment: This is the California Arbitration Act, California Code of
Civil Procedure Sections 1280 through 1294.2, if the Employer is located in California; if
the Employer is located in another state, you will want to find the similar section in that
state’s laws] (hereinafter referred to as the “Act”) which is incorporated herein by reference.

       c.      Employee and Employer shall each appoint one (1) neutral and impartial person
to hear and determine the dispute and, if the two (2) persons so selected are unable to agree,
those two (2) persons shall select a third (3rd) impartial arbitrator whose decision shall be final
and conclusive upon both parties.


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         d.       The result of arbitration hereunder shall be binding upon the parties.

2.       MISCELLANEOUS

       a.      This Arbitration Agreement constitutes the entire agreement between the parties
hereto with respect to the specific subject matter hereof and supersedes all prior agreements or
understandings of any kind with respect to the specific subject matter hereof.

        b.     In the event that any provision or part of this Arbitration Agreement shall be
deemed void or invalid by a court of competent jurisdiction, the remaining provisions or parts
shall be and remain in full force and effect.

       c.      Any and all additions, deletions, or modification to this Arbitration Agreement
must be in writing and signed by the parties or it shall have no effect and shall be void.

        d.     This Arbitration Agreement is binding upon and shall inure to the benefit of the
respective successors, licensees and/or assigns of the parties hereto.

       e.     This Arbitration Agreement shall be governed in accordance with the laws of the
State of __________________ [Instructions: Insert the state’s laws that will govern this
agreement] applicable to agreements to be wholly performed therein, without giving effect to its
laws governing conflict of laws,

3.       NOTICE

THE PARTIES HERETO UNDERSTANDS THAT BY SIGNING THIS ARBITRATION
AGREEMENT EACH PARTY IS AGREEING TO HAVE ANY ISSUE RELATING TO
EMPLOYER’S EMPLOYMENT OF EMPLOYEE DECIDED BY NEUTRAL ARBITRATION
AND THE PARTIES ARE GIVING UP THEIR RIGHT TO A JURY OR COURT TRIAL. SEE
PARAGRAPH 1 OF THIS ARBITRATION AGREEMENT.

IN WITNESS WHEREOF the parties have duly executed this Arbitration Agreement as of the
date first written above.

EMPLOYER:                                                        EMPLOYEE:



__________________________                                       __________________________
__________ [Instructions: Insert name]                           __________ [Instructions: Insert name]




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