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No Arbitration: Age Discrimination Suit Against Chrysler May Proceed

In a lawsuit filed in early 2017, four former workers over the age of 55 accused Fiat Chrysler Automobiles (FCA) of age discrimination. FCA had a two-part evaluation system for its workers. A supervisor initially rated an employee’s performance as “high,” “medium,” or “low.” In the second part of the process, called “calibration,” management reviewed pictures of employees and had available numbers reflecting length of employment. Those employees with low scores would be placed on a performance improvement plan or fired. Employees scoring well were eligible for promotion and additional compensation.

The plaintiffs asserted that older workers disproportionately received lower scores than their younger counterparts. After suit was filed, FCA moved to compel arbitration, asserting that the workers had agreed to binding arbitration.

A Michigan federal trial court concluded that these workers could not be compelled to arbitrate. The arbitration policy was set forth in a notice of new policy handed out to employees. FCA argued that the employees tacitly agreed to the arbitration by continuing to work after receiving notice of the policy. The court disagreed and concluded: “In the absence of any signed agreement or any FCA-distributed materials expressly telling plaintiffs that they would accept the terms of the [employment dispute resolution process] by continuing their employment, the court cannot find that there was an agreement to arbitrate.”