Trial News

A New Jersey appellate court has ruled that the design of an online training course about Pfizer, Inc.’s employee arbitration policy violated state contract law and was not a legally binding waiver of the right to a jury trial. The court found that despite references to an “agreement” throughout the training course materials, the “oblique procedure” the company used did not constitute a valid and knowing waiver of the employees’ legal rights. (Skuse v. Pfizer, Inc., 2019 WL 237301 (N.J. Super. Ct. App. Div. Jan. 16, 2019).)

Pfizer had a policy requiring flight attendants to receive a yellow fever vaccine. As a practicing Buddhist, Amy Skuse did not receive any injections that contained animal protein. She worked for Pfizer for five years as a flight attendant without anyone pressing the vaccine issue. Then, in 2017, the company told her that she needed to be vaccinated within 30 days or she would be terminated. Skuse explained that she had a valid waiver to travel to countries where yellow fever was a risk and presented documentation from her doctor to request a reasonable accommodation based on her religious beliefs. Pfizer denied the request and Skuse’s internal appeal and then terminated her.

Skuse sued Pfizer for religious discrimination and failure to provide a reasonable accommodation under the New Jersey Law Against Discrimination. The trial court granted the defendant’s motion to compel arbitration. Skuse appealed, arguing that she had never entered into a valid arbitration agreement with the defendant.

Pfizer’s arbitration policy was contained in an online training module that was emailed to thousands of employees. In the email, a link led employees to an online portal that the company used for training and instructed them to go through a slide presentation. A separate email with another link provided access to a frequently asked questions page about the arbitration policy, and that page included the full language of the policy that explained the rights that employees were giving up.

On the third slide of the training module was a paragraph stating that employees must agree to the arbitration policy and to the class action waiver to remain employed. It also stated that even if they did not agree, they would be deemed to have consented if they remained at the company for 60 days. At the bottom of the slide was an electronic click button labeled “click here to acknowledge.” The last slide in the module said, “Thank you for reviewing the Mutual Arbitration and Class Waiver Agreement.” The company never asked employees to confirm they had received the arbitration policy.

The trial court held that despite the defendant not requiring that Skuse confirm she had received the arbitration policy, the fact that she remained with Pfizer for 60 days after completing the training meant that she intended to be bound by the policy. The court dismissed the plaintiff’s claims with prejudice and ordered the parties to proceed to arbitration.

The appellate court disagreed, finding that the training module’s design did not comply with state contract law principles governing mutual consent and a knowing and voluntary waiver of rights. The court cited New Jersey Supreme Court precedent in Leodori v. CIGNA Corp. (814 A.2d 1098 (N.J. 2003)), which held that “an arbitration provision cannot be enforced against an employee who does not sign or otherwise explicitly indicate his or her agreement to it.” Leodori also set forth that for a waiver of rights to be adequate, the employee must “clearly and unambiguously” agree to arbitrate a claim.

Here, the court noted that although a physical signature was not required in a digital world, an employer’s attempt to secure consent to an arbitration policy through digital means had to be robust enough to meet Leodori’s requirements. Therefore, it must show an “explicit, affirmative agreement that unmistakably reflects the employee’s assent” to the policy. The court questioned the defendant’s use of a training module to accomplish this, noting that this format did not “fairly capture the essence of the endeavor” and that “obtaining an employee’s binding waiver of his or her legal rights is not a training exercise. It is not on par with routine or mundane training subjects, such as how to obtain an assigned parking space.”

The court concluded that it could not be confident that employees who received the emails about the training and then clicked through the slides had a clear understanding of the rights they were waiving—especially since the arbitration policy was part of a separate “Resources” tab in one email link. The court also called the “click here to acknowledge” button at the end of the slides a “critical shortcoming” because it did not make clear that by clicking, employees were agreeing to the arbitration policy’s terms and waiving their right to have their disputes heard in court. Earlier language in the presentation implied that employees were simply to acknowledge that they had received the policy, and the last slide used the term “review,” but nothing indicated that employees were assenting to anything.

Next, the court considered whether the plaintiff could be deemed to have consented to the arbitration policy because she continued working for the defendant for more than 60 days after completing the training. It rejected this argument, finding that this provision was merely “an attempt to bypass” Leodori by imagining that even without voluntary consent to the policy, that employees could give consent by continuing to come to work. The court stated that the case “exemplifies an inadequate way for an employer to go about extracting its employees’ agreement to submit to binding arbitration for future claims and thereby waive their rights to sue the employer and seek a jury trial.”

Moorestown, N.J., attorney Richard Schall, who argued on behalf of amicus National Employment Lawyers Association of New Jersey, said that although Leodori made it clear that employees must affirmatively agree to arbitration, “companies have nonetheless continued to try to find ways to force arbitration agreements on their employees.” Skuse made a few important things clear, Schall explained: “It is not enough for employers to simply have employees ‘acknowledge’ their receipt and awareness of an arbitration policy; instead some form of knowing and voluntary agreement must be obtained. ‘Continued employment’ is not a substitute for ‘agreement.’ This is a very significant holding, since an earlier appellate division panel had suggested that an employee’s continuing his employment after being put on notice of the arbitration policy constitutes an agreement to be bound.”

Schall also noted that “Skuse is the first case I’ve seen to take judicial notice of the problem with mass emails as a mechanism to obtain something as significant as an employee’s waiver of his or her statutory rights. If companies want to obtain their employees’ agreement to be bound by an arbitration policy, they should not use mass emails that fail to make clear that the email is not just another run-of-the-mill corporate email blast.”