As a condition of employment, Amgen requires its employees to sign arbitration agreements. This has been a trend for a number of years in corporate America and the reason is that this method of resolving disputes can be less expensive for employers, since arbitration doesn't involve the court system.
One former Amgen sales rep, however, is challenging the practice. In a lawsuit, Marc Engelman accuses the biotech of forcing reps to engage in off-label promotion and patient privacy violations to market the Enbrel medication for psoriasis. But he also charges the arbitration agreement is "procedurally unconscionable" and names the American Arbitration Association as a co-defendant.
How is it unconscionable? For instance, the deal doesn't allow for dispute involving retaliation; limits discovery to a single individual deposition for each party and then only one expert deposition; requires aggrieved employees to pay for a court reporter; and allows only Amgen an exception to arbitration to seek relief in court, according to the suit filed in a California state court.
"This is inherently weighted in favor of Amgen," says Bob Hennig, Engleman's attorney. "But this is actually a national issue with many employers and it's not contained to any one industry. They want to eliminate risk and, in California, arbitration is the only way you can get someone's claim away from a jury trial." He adds that, in California, the constitution guarantees a jury trial.
By filing a lawsuit, Engelman is challenging Amgen's right to have disputes resolved only through arbitration. The National Employment Lawyers Association, however, says the deck may be stacked. Between January 2003 and March 2007, 97 percent of Pfizer arbitration cases that required a decision were decided in favor of the drugmaker, according to American Association Arbitration data analyzed by NELA. The figure was 82 percent in favor of Haliburton during the same period.
For its part, an Amgen spokeswoman sent us this statement: "Both the United States Supreme Court and California Supreme Court have said many times that there is a strong public policy favoring arbitration as a means of dispute resolution. We believe Amgen’s arbitration program – which has been in place for more than a decade – is fair and appropriate." She adds that arbitration "is commonplace in industry, based on the strong public policy in favor of arbitration." A spokesman for AAA declined to comment.