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    You Say No Contract, Then No Contract

    A recent Federal District Court in Minnesota has determined that an employee handbook provision that provided for an arbitration procedure is not enforceable, but the arbitration provision that was contained in the employment application was enforceable. At issue was an action in which the plaintiffs claimed employment discrimination and retaliation, and the employer desired to have these claims arbitrated. The disclaimer in the application only suggested that the employment application did not create a contract for either employment or the provisions of any benefit, but it did not disavow or imply that the arbitration provision on the application was not a contract. On the other hand, the handbook included a more general disclaimer suggesting that it was not an employment contract and was not intended to create contractual obligations of any kind. Therefore, the Court determined that the arbitration provision was not an enforceable contractual provision. Nabry, et al. v. MV Transportation, Inc. (D.C. Minn. 2007). Therefore, if you want any certain provisions in the handbook or employment application to be enforceable against employees (such as arbitration), you must specifically limit your disclaimers.

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