Northern Kentucky Area Development District v. Snyder

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Justia Opinion Summary

The Supreme Court affirmed the decision of the court of appeals affirming the trial court’s order denying Employer’s motion to compel enforcement of the arbitration agreement between the parties in this case, holding that the arbitration agreement between Employer and Employee was unenforceable as a matter of law.

Employer conditioned Employee’s continued employment on her agreement to arbitrate any dispute that may arise between them. The Supreme Court held that the arbitration agreement was unenforceable as a matter of state statutory law because (1) Ky. Rev. Stat. 336.700(2) prohibits employers from conditioning employment on an existing employee’s or prospective employee’s agreement to “waive, arbitrate, or otherwise diminish any existing or future claim, right, or benefit to which the employee or person seeking employment would otherwise be entitled”; and (2) the Federal Arbitration Act does not mandate a contrary holding because it does not preempt section 336.700(2) in this case.