Employers—it’s time to check your arbitration and class-action waiver provisions. The United States District Court for the Northern District of California recently granted DoorDash drivers’ motion to compel arbitration, which may ultimately cost DoorDash nearly $12 million in American Arbitration Association (AAA) filing fees.
When a driver signs up to deliver through DoorDash, they click through and electronically sign an employment agreement containing a “Mutual Arbitration Provision” and a class-action waiver. Like many other employers with similar contracts, DoorDash’s employment agreement requires all disputes to be arbitrated by, and pursuant to, AAA rules. One of those rules requires individuals to pay a $300 filing fee and responding companies to pay a $1,900 filing fee. For years, employers have used these arbitration provisions to individually arbitrate disputes as well as avoid class-action lawsuits and courtroom litigation.