Arbitration agreement in employment relationship is enforced, although alternative procedure is "prohibitively expensive".
In recent years, the courts have allowed employers to demand that employees sign away their civil and legal procedural rights in order to secure employment, if the employment agreement provides an "alternative" [exclusive] forum. Courts have upheld these rights as long as the employee's underlying substantive rights are not waived, so that the employee has some reasonable alternative for enforcement. In a Federal case, Cole v. Burns Int'l Security Serv., the court held that an employer cannot demand that the employee pay a substantial portion of the arbitration procedure it mandates.
Michigan has rejected that approach, however, and allows the employer's arbitration agreement to require the employee to pay one-half of the related expenses, even if the expenses are "prohibitively expensive" and preclude employees from exercising their rights. In Rembert v. Ryan's Family Steak House, and now Cash v. D. & J. Spartan Tire, Inc., the Court of Appeals has upheld such fee- and cost-splitting arrangements, determining that they do not violate an employee's rights under state law, whether the waiver of rights is contained in an individually-negotiated contract or an employee manual.