Key point 10-16.8. Churches have various defenses available to them if they are sued as a result of a personal injury. One such defense is an arbitration policy. By adopting an arbitration policy, a church can compel members to arbitrate specified disputes with their church rather than pursue their claim in the civil courts.
* A New York court ruled that an arbitration clause in an employment contract between a synagogue and a rabbi was legally enforceable, and so the rabbi was barred from suing the synagogue in civil court for discrimination and wrongful termination. A synagogue chose not to renew the employment contract of its rabbi shortly after the rabbi disclosed that he had cancer. The rabbi sued the synagogue, claiming that its decision not to renew his contract amounted to wrongful termination and discrimination based on disability. The synagogue asked the trial court to dismiss the case on the ground that the rabbi’s employment contract contained a clause agreeing to resolve employment disputes through binding arbitration. The trial court ruled that this clause was not enforceable, and the synagogue appealed. A state appeals court ruled that the arbitration clause was enforceable, and it dismissed the lawsuit. The court concluded, "Contrary to the [trial court’s] conclusion, we perceive no public policy reasons for not enforcing anticipatory agreements to arbitrate statutory employment discrimination claims arising under [state law]. Moreover, the broad arbitration clause in [the rabbi’s] employment contract encompasses his claim of wrongful discharge based on a physical disability."
Application. Employment disputes are one of the most common forms of church litigation. Church leaders should consider the potential benefits of mediation or arbitration clauses in employment contracts involving both ministers and lay employees. Of course, the services of a local attorney will be invaluable in helping you evaluate the merits of an arbitration clause, and in drafting one. South Huntington Jewish Center, Inc. v. Heyman, 723 N.Y.S.2d 511 (App. Div. 2001).
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