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A group of former insurance executives may be left with little choice but to confront their former employer outside the courtroom.
Duluth-based Primerica Financial Services Inc. has moved to force the disgruntled ex-employees into arbitration, according to documents filed in the U.S. District Court for the Northern District of Georgia on March 16. The eight former Primerica salespeople sued the insurance company in the early 1990s, charging the company with running a pyramid scheme as to their commission payoffs and employment status.
Since then, the battle has been not so much over the substance of the allegations, but about whether the parties would attempt to settle out of court. After a recent U.S. Supreme Court ruling, arbitration may become the method du jour for disputes similar to Primerica's. The Supreme Court ruled 5-4 earlier this month that companies may require disgruntled employees to resolve disputes through arbitration if their employment contracts included such a provision.
The impact of the decision, in my view, is it will dramatically reduce the amount of employment litigation in the courts, and substantially increase the number of arbitrations," said Mark Carter, a labor law specialist and a partner with Heenan Althen & Roles LLP in West Virginia. Carter also is a board member...