What is an agreement to arbitrate?
An agreement to arbitrate is an agreement between two or more parties that a dispute or claim will be resolved through binding arbitration rather than litigation in a court of law. Generally, the parties agree to submit the dispute to an independent third-party who will hear both sides of the argument and then make a decision about the dispute. The agreement to arbitrate may be part of an employment or a contract between two parties. In Florida, an agreement to arbitrate is enforceable by both state and federal law and is governed by the Florida Arbitration Code. This code outlines the procedures for choosing arbitration, how arbitration proceedings are conducted, and how arbitration awards are enforced. It also sets limits on how much an arbitrator can award in damages. The agreement to arbitrate in Florida is voluntary, so both parties must agree to it before it is binding. If an employer requires an employee to sign an agreement to arbitrate as a condition of employment, it is considered a contract, which must be written and signed by both parties. Agreements to arbitrate can help resolve disputes in a shorter amount of time than litigation. By agreeing to arbitrate, the parties usually agree to have the arbitrator’s decision be final and binding, so less time and money is spent on legal proceedings. Additionally, if the parties were to choose litigation in a court of law, the dispute might be heard before a jury, whereas arbitration is usually heard by a single arbitrator.
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