Arbitration agreement blocks termination suit

In Kentucky, a claim that a worker was discharged in retaliation for filing a workers' compensation claim is a wrongful discharge claim, not a workers' compensation claim.

Case name: Whalen v. Lord & Moses, LLC, No. 09-192-JBC (E.D. Ky. 11/10/09).

Ruling: The U.S. District Court, Eastern District of Kentucky held that it lacked jurisdiction to hear the worker's wrongful discharge claim because the claim was within the scope of a binding arbitration agreement.

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What it means: In Kentucky, a claim that a worker was discharged in retaliation for filing a workers' compensation claim is a wrongful discharge claim, not a workers' compensation claim.

Summary: A cemetery worker was allegedly injured on the job when her manager required her to move around the facility grounds during a storm. When she filed a claim for workers' compensation, her employer allegedly refused to process her request and terminated her. The worker sued her employer for wrongful discharge. The employer argued the court lacked jurisdiction to hear her claim because the worker had signed an agreement that compelled binding arbitration.

The agreement identified the types of claims that were exempted from coverage: workers' compensation claims; claims for unemployment benefits; and claims to enforce noncompetition or confidentiality agreements. The court rejected the worker's arguments that the agreement was invalid. In Kentucky, the court explained, a person who signs a contract is presumed to know its contents and is bound by its provisions.

The court also determined that a wrongful discharge claim is not a workers' compensation claim. Therefore, the court lacked jurisdiction, and the claim was subject to arbitration. The court noted there were numerous references to arbitration on each page of the agreement. It also rejected her argument that the contract was ambiguous, noting that the most pertinent provisions of the document "effectively convey the parties' intent that disputes would be resolved through arbitration, and the [worker] has not established any defenses to contract formation."

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January 18, 2010

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