In a recent decision, the Texas Supreme Court indicated that employers may fire employees who refuse to waive their right to a jury trial.
The opinion was In re Frank Kent Motor Company d/b/a Frank Kent Cadillac, ___ S.W.3d ___ (Tex. 2012). In that case, a 28-year employee of a dealership was forced to waive his right to a jury in the event of any disputes with his employer. He was “told that he would lose his job if he refused.”
About one year later, the employee was terminated. He filed suit and demanded a jury, contending that he had only waived a jury under coercion. The Court said that a jury waiver that is coerced is invalid but ruled that the employee had not been coerced here. Since he was an “at-will employee,” the employer does not coerce him “by demanding that the employee accept new dispute resolution procedures.” In Texas, the employer can terminate an at-will employee “for any reason or no reason at all.” Thus, an employer can force an employee to accept arbitration. Accordingly, the “employer’s threat to exercise its legal right [to fire an employee] cannot amount to coercion that invalidates a contract.” Instead, to coerce an employee, the employer would have to threaten an act it “had no legal right to do” which “overcomes the other party’s free will….” Since the employer can “fire an employee for almost any reason, threatening to fire an employee who does not accept new employment contract terms is not coercion that will invalidate a contract.”