Avoiding Litigation: The Benefits of Employment Contracts and Arbitration
Journal of Small Business Strategy, Vol. 10, No. 2, pp. 1-10, 1999
Posted: 22 Feb 2008
Abstract
This research reviews the current environment in employment disputes. In an ever-increasing litigious era where it is not uncommon to see six-figure settlements, the entrepreneur needs to examine the possible legal options in the event of a lawsuit involving current or former employees. While many employment-oriented lawsuits are settled through litigation, this is a time-consuming and costly process. Indeed, due to its adversarial nature, dispute resolution through litigation can take years to settle. In contrast, one business strategy that is growing in popularity includes the use of employment contracts specifying arbitration in dispute resolution. Because arbitration is almost entirely separate from the legal system (Siegel, Sect. 586), it offers many advantages to both employers and employees.
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