Individual arbitration agreements are often challenged on the
grounds that the individual did not agree to arbitrate claims. For example, in March the 3rd Circuit ruled that a law firm shareholder cannot be forced to arbitrate her claims of sex discrimination and sexual harassment.

Alyson Kirlies filed suit accusing Dickie McCamey & Chilcote of paying female lawyers less than males. She claims one male partner said a woman with children should give up her partnership and work part-time, and another said the role of women lawyers was to prepare lawsuits that male lawyers would handle.

The law firm said the suit should be dismissed because its bylaws require shareholders to arbitrate any disputes. But the 3rd Circuit said the suit could proceed because she was never informed of the arbitration clause in the bylaws and never agreed to it. The court said Pennsylvania law requires explicit agreement for an arbitration agreement to be enforceable. This could impact employers who include arbitration agreements in employee handbooks.

“To say you will agree to read a handbook does not mean you read it,” says Jeffrey Pasek, a Cozen O'Connor member. “The 3rd Circuit says there has to be knowing agreement to arbitrate.”