Lorenzo v. Prime Commc’ns, L.P., Nos. 14-1622, 14-1727 (4th Cir. Nov. 24, 2015).
To ensure that they can’t be sued for breach of contract, employers generally include disclaimers in their employee handbooks saying that the handbooks aren’t contracts and don’t make any binding promises. This cautionary measure has come back to bite the employer in this case.
An employee, Rose Lorenzo, has sued her employer, Prime Communications, for violating the FLSA. Prime Communications says that Lorenzo’s FLSA claims must be arbitrated because she agreed to an arbitration clause in an employee handbook. When she began work, Lorenzo signed a form acknowledging she’d received the handbook. Hence, says the employer, she agreed to the handbook’s arbitration clause.
But the acknowledgment that Lorenzo signed also said that the handbook wasn’t meant to be a binding contract. Hence, the arbitration provision in the handbook wasn’t a binding promise, and Lorenzo’s FLSA claims aren’t subject to arbitration.