- AAA Amends National Rules for the Resolution of Employment Disputes
- April 29, 2003
- Law Firm: Ford & Harrison LLP - Atlanta Office
Employers with arbitration agreements that incorporate the American Arbitration Association's (AAA) National Rules for the Resolution of Employment Disputes should be aware that the AAA has revised these rules effective November 1, 2002. Following is a summary of some of the more significant revisions.
Changes to the Administrative Fee Schedule Section for Disputes Arising Out of Employer-Promulgated Plans
The rules now provide that the administrative fee schedule is based on filing and service charges. Arbitrator compensation is not included in this fee schedule. The employer is to pay the total cost of arbitrator compensation unless the employee chooses to pay a portion. The arbitrator cannot reallocate the cost of arbitrator compensation or administrative fees unless he or she determines that a claim or counterclaim was filed for the purposes of harassment or was patently frivolous.
In cases before a single arbitrator, the employee must pay a nonrefundable filing fee when the claim is filed, which is capped at $125 unless the plan provides for the employee to pay less. The employer must pay a nonrefundable filing fee in the amount of $375 unless the plan provides that the employer is to pay more. In cases before three or more arbitrators, the employee must pay a nonrefundable filing fee that is capped at $125 unless the plan provides for the employee to pay less. The employer must pay a nonrefundable filing fee of $1,375 unless the plan provides for the employer to pay more.
For each day of hearing held before a single arbitrator, the employer must pay an administrative fee of $300. For each day of hearing held before a multi-arbitrator panel, the employer must pay an administrative fee of $500. There is no AAA hearing fee for the initial Arbitration Management Conference. The hearing fees do not include the rental of hearing rooms, which must be paid by the employer.
Changes to the Administrative Fee Schedule Section for Disputes Arising Out of Individually Negotiated Employment Agreements and Contracts
The AAA's Commercial Fee Schedule applies to disputes arising out of individually negotiated employment agreements and contracts, even if such agreements and contracts reference or incorporate an employer-promulgated plan. The AAA shall resolve any questions or disagreements about whether a matter arises out of an employer-promulgated plan or an individually negotiated agreement or contract. The AAA's determination shall be final. The AAA may, if extreme hardship on any party is shown, defer or reduce the administrative fee.
Abeyance Fee Added to Administrative Fees Schedules for Disputes Arising Out of Employer-Promulgated Plans and Individually-Negotiated Agreements
Parties on cases held in abeyance for one year by agreement will be assessed an annual abeyance fee of $300. If a party refuses to pay the assessed fee, the other party or parties may pay the entire fee on behalf of all parties, otherwise the matter will be closed.
The AAA also revised the rules relating to administrative fees, expenses, arbitrator's compensation, and deposits. To review the full text of the revised rules and the AAA's summary of revisions, go to www.adr.org.