Skip to main content
« Back to Blog

Are arbitration clauses in employment contracts enforceable?

The Employment Rights Act 1996 (ERA) and the Equality Act 2010 (EqA) both prohibit contracting out clauses.

Ms van Winkelhof joined global law firm, Clyde & Co, and in doing so she entered into the firm’s members agreement. That agreement had a clause in it specifying the steps that would need to be taken in the case of disputes between members and between former members and the firm.

In summary, the clause stated that if a dispute could not be resolved by way of internal procedures or alternative dispute resolution, then the dispute would have to be dealt with by arbitration.

Unfortunately events did not proceed as Ms van Winkelhof might have hoped, and she was expelled from the firm in January 2011. She proceeded to complain that she had been the subject of sex discrimination / pregnancy discrimination and brought a whistleblowing claim.

Clyde & Co tried to enforce the clause in the members agreement to prevent Ms van Winkelhof from making these claims  – or at least, to get her to agree to a stay of her Employment Tribunal (ET) claims subject to following the contractual dispute resolution procedures – by applying for an injunction.

The High Court refused to grant an injunction on the basis that if a dispute had to be dealt with by arbitration, then any decision made by the arbitrator would be final, and only subject to an appeal on a question of law. This would mean that Ms van Winkelhof would fully lose her rights to any claims in the ET.

Therefore employment contracts should not purport to limit a person’s entitlement to bring tribunal proceedings under the ERA and EqA and arbitration clauses or other dispute resolution procedures set out in an employment contract cannot be enforced to prevent a person from bringing ET claims.

 By Rebecca Pitt