When a business relationship sours, it can sometimes lead to costly litigation for both parties involved. To limit the costs of handling disputes, more businesses are placing arbitration provisions — which require disputes to go to arbitration, not a courtroom — in their contracts with employees and vendors.
In a recent case, an Ohio court enforced an arbitration provision in an employment contract. A former employee sued her employer for various claims, including breach of contract, wrongful termination and tortious interference with a contract. She had an employment contract that included an arbitration clause mandating that any disputes between the parties be submitted to arbitration. The court enforced the provision and stayed court proceedings pending arbitration.
As this case shows, businesses should consider reviewing their contracts to determine whether including arbitration clauses could make sense for them.