Signed an Arbitration Agreement? You May Still Have a Claim

Who this is for: Salaried or day-rate workers who signed an arbitration agreement in onboarding paperwork and think they were shorted on overtime.

What's going on: The employer says the agreement means you can't sue and can't join a group case.

What you can do: Find the agreement. What it actually says, and whether it's valid, decides your path.

An arbitration agreement usually changes where you bring an overtime claim, not whether you have one: you can still recover unpaid overtime and liquidated damages, typically in your own individual arbitration.

Your situation	Where the claim usually goes
No arbitration agreement	Federal court, alone or in a collective action
Agreement with a class/collective waiver	Your own individual arbitration
Agreement without a group waiver	Depends on the wording; sometimes a group arbitration or court
Agreement that's invalid or doesn't cover wage claims	Court

What the Supreme Court said

In Epic Systems Corp. v. Lewis,¹ the Court upheld waivers of class and collective actions in employment arbitration agreements: "In the Federal Arbitration Act, Congress has instructed federal courts to enforce arbitration agreements according to their terms—including terms providing for individualized proceedings."

That's the bad news. Here's the rest of it. The agreement doesn't erase the FLSA. The same rights, the same overtime, the same doubled damages apply in arbitration. You just bring the claim to an arbitrator instead of a jury.

Check these before you give up

Did you actually agree? A handbook "acknowledgment" or a click-through you never saw is worth a hard look. The employer has to prove the agreement exists.
Does it cover wage claims? Some agreements carve out statutory or wage claims, or only cover certain disputes.
Does it actually waive group claims? Not every agreement has a class or collective waiver.
Was there an opt-out window? Some agreements let new hires opt out within a set window. If you opted out, the agreement may not bind you.
Is it one-sided? Unfair terms (short filing periods, cost-shifting, caps on damages) can be struck under state contract law. Generally applicable contract defenses, including unconscionability, apply to arbitration agreements; what a state may not do is single arbitration out for special rules.⁹
Are you a transportation worker? The Federal Arbitration Act doesn't cover workers who move goods in interstate commerce.² State arbitration law may still apply.
Did the employer drag its feet? An employer that litigates too long before moving to compel can waive its right to arbitrate, and you do not have to show its delay prejudiced you.¹⁰

Who pays for arbitration?

Usually the employer, for nearly all of it. The AAA caps an individual's filing fee at $350 and makes the company pay the arbitrator's compensation.¹¹ Under the JAMS employment standards, “[t]he only fee that an employee may be required to pay is JAMS' initial Case Management Fee.”¹² In California, an employer that is 30 days late paying arbitration fees is in material breach and waives its right to compel arbitration.¹³ The FLSA also makes the employer pay your attorney's fees if you win.³ See what an overtime lawyer costs.

Many workers, many arbitrations

A collective waiver means each worker files a separate arbitration. When dozens or hundreds of workers do that at once, the employer pays fees on each case. Filed together, those claims change the cost math for the employer.

For a worker, the point is simple: one person's arbitration is a real case. You still get to prove the hours, the misclassification, and the damages.

If coworkers already filed a lawsuit

Courts in some circuits won't send collective-action notice to workers who signed valid arbitration agreements. The Fifth Circuit held that "district courts may not send notice to an employee with a valid arbitration agreement unless the record shows that nothing in the agreement would prohibit that employee from participating in the collective action."⁴

The Seventh Circuit put the burden on the employer. It must show, "by a preponderance of the evidence, the existence of a valid arbitration agreement for each employee it seeks to exclude from receiving notice."⁵

So you might not get a notice even though coworkers are suing. That doesn't mean you don't have a claim. It means you may need your own arbitration. See got a notice about an overtime lawsuit? and how collective actions work.

The limitations period

FLSA claims reach back two years, three if willful.⁶ A coworker's lawsuit does not include you: in a collective action your own lookback period is measured from the date your written consent is filed.¹⁴ See how far back a claim reaches.

Siegel Law Group has recovered more than $100 million for workers in federal overtime cases, including a $38.7 million class and collective settlement in Pruess v. Presbyterian Health Plan,⁷ where the firm was lead counsel. Past results do not guarantee future outcomes.

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Questions we hear

I signed an arbitration agreement. Can I still get overtime?

Yes, if you were owed it. The agreement usually controls the forum, not the right.

Can my employer fire me for bringing an arbitration claim?

Not legally. The FLSA bars retaliation for asserting overtime rights.⁸

Is arbitration confidential?

Often, depending on the agreement and the provider rules. That cuts both ways, and it's worth discussing before you file.

Do I have to pay the arbitrator?

In employment cases, the employer usually pays almost all of the arbitration costs. Read the agreement and the provider's rules.

I don't have a copy of the agreement.

Ask HR in writing, or check the onboarding portal. A lawyer can also request it.

Keep reading

Free, confidential case review: (214) 790-4454.

We take overtime cases on contingency. We advance the costs of the case, and if we recover, those costs are repaid out of the recovery. If we do not recover, you owe us nothing — no attorney's fee and no costs.

Notes

Epic Systems Corp. v. Lewis, 584 U.S. 497 (2018).
Southwest Airlines Co. v. Saxon, 596 U.S. 450 (2022).
29 U.S.C. § 216(b).
In re JPMorgan Chase &; Co., 916 F.3d 494 (5th Cir. 2019).
Bigger v. Facebook, Inc., 947 F.3d 1043 (7th Cir. 2020).
29 U.S.C. § 255(a).
Pruess v. Presbyterian Health Plan (D.N.M.), final approval June 24, 2026.
29 U.S.C. § 215(a)(3).
Doctor's Associates, Inc. v. Casarotto, 517 U.S. 681, 687 (1996) (“generally applicable contract defenses, such as fraud, duress, or unconscionability, may be applied to invalidate arbitration agreements without contravening § 2”; “Courts may not, however, invalidate arbitration agreements under state laws applicable only to arbitration provisions”).
Morgan v. Sundance, Inc., 596 U.S. 411, 419 (2022) (“prejudice is not a condition of finding that a party, by litigating too long, waived its right to stay litigation or compel arbitration under the FAA”).
AAA Employment/Workplace Fee Schedule, Costs of Arbitration (amended and effective Jan. 15, 2024) (“Non-refundable* filing fee capped at $350”; “The company shall pay the arbitrator's compensation unless the individual, post dispute, voluntarily elects to pay a portion of the arbitrator's compensation”).
JAMS Employment Arbitration Minimum Standards of Procedural Fairness, Standard 6 (“All other costs must be borne by the company, including any additional JAMS Case Management Fee and all professional fees for the arbitrator’s services”).
Cal. Code Civ. Proc. § 1281.97(a)(1) (fees to initiate arbitration: not paid within 30 days of the due date, the drafting party “is in material breach of the arbitration agreement, is in default of the arbitration, and waives its right to compel arbitration under Section 1281.2”); § 1281.98(a)(1) (same rule for fees required to continue a pending arbitration).
29 U.S.C. § 256(b) (in a collective action the action is commenced for an individual claimant “on the subsequent date on which such written consent is filed in the court in which the action was commenced”).