For many seamen signing on for a new hitch, the stack of paperwork can feel like a formality. The focus is on the job, the vessel, and the voyage ahead. Buried deep within that employment contract, however, is often a section that can completely alter a mariner’s rights after a serious injury. This is the maritime arbitration clause, a piece of legal text that many sign without a second thought, but which can mean forfeiting the right to have your day in court.
What Exactly is a Maritime Arbitration Clause?
At its core, an arbitration clause is a contractual agreement to resolve disputes outside of the traditional judicial system. Instead of filing a lawsuit in federal court to be heard by a judge and jury, the parties agree to submit their case to a neutral third-party arbitrator or a panel of arbitrators. The arbitrator hears evidence from both sides and then issues a decision that is typically binding.
Think of it as a private trial. However, the rules, procedures, and even the decision-maker are different from what you would find in a courtroom.
Key features of arbitration often include:
- A Private Process: Hearings are not open to the public, and the final decision is usually confidential.
- A Binding Decision: The arbitrator’s ruling, known as an “award,” is legally binding and has the same effect as a court judgment.
- Limited Right to Appeal: It is exceedingly difficult to challenge or overturn an arbitrator’s award, even if they made a clear error of law or fact.
- Employer-Friendly Terms: The clause itself may dictate the location of the arbitration, the rules that apply, and how the arbitrator is selected, all of which can be structured to favor the employer.
Why Do Employers Insist on Arbitration?
Maritime employers and vessel owners have several reasons for favoring arbitration over court litigation. While often presented as a more efficient way to resolve disputes, these clauses primarily serve to limit the company’s risk and potential financial exposure when a seaman is injured due to negligence or an unseaworthy condition.
Employers prefer arbitration for these reasons:
- Avoiding Jury Trials: This is perhaps the most significant factor. Juries, particularly in port cities like Mobile, are often composed of individuals who appreciate the difficult nature of maritime work. They may be more sympathetic to an injured seaman and are known to award substantial damages for pain, suffering, and disability. Arbitrators, who are often attorneys or retired judges, may be more conservative in their damage awards.
- Controlling Costs and Speed: While not always the case, arbitration can sometimes be faster and less expensive than a full-blown federal court case. The process for gathering evidence (discovery) is typically more limited.
- Maintaining Confidentiality: Companies prefer to keep injury claims and safety issues private. Arbitration prevents the creation of a public record that could reveal patterns of negligence or unsafe vessel conditions.
- Increased Predictability: Employers may feel that a professional arbitrator provides a more predictable outcome than a jury of twelve ordinary citizens. This is especially true if they can select an arbitrator from a small pool of individuals who regularly handle maritime cases.
The Central Legal Conflict: The Federal Arbitration Act Versus a Seaman’s Protections
The enforceability of these clauses hinges on a long-standing tension in federal law. On one side is the Federal Arbitration Act (FAA), a law passed in 1925 that establishes a strong national policy in favor of enforcing arbitration agreements. Employers rely heavily on the FAA to compel injured seamen into arbitration.
On the other side are the specific legal protections granted to mariners. Section 1 of the FAA itself contains an exemption for “contracts of employment of seamen, railroad employees, or any other class of workers engaged in foreign or interstate commerce.” For nearly a century, courts have debated what this exemption means. Seamen’s advocates argue it is a clear statement from Congress that mariners cannot be forced to arbitrate their injury claims.
However, a Supreme Court decision narrowed the scope of this exemption for many land-based workers, and maritime employers have used that precedent to argue that the exemption does not apply to most modern seamen’s contracts. Furthermore, companies often invoke an international treaty, the Convention on the Recognition and Enforcement of Foreign Arbitral Awards (often called the New York Convention), to bypass the FAA’s seamen exemption entirely. They argue that because a seaman’s work involves international commerce, the treaty applies and mandates arbitration.
This creates a complex legal fight. An injured seaman’s right to sue under the Jones Act and the general maritime law doctrine of unseaworthiness are powerful tools for holding employers accountable. Forcing these claims into arbitration can strip away one of the most important of these rights: the right to a trial by jury.
The Real-World Disadvantages of Arbitration for an Injured Mariner
Moving a case from a courtroom to a private arbitration forum is not merely a change of venue. It fundamentally changes the dynamic of a claim and can place the injured seaman at a significant disadvantage.
- No Right to a Jury: A jury of your peers is a foundational American right. In a Jones Act case, it allows members of the community to hear the evidence of a company’s negligence and decide what fair compensation looks like. Losing this right is a major concession.
- Potential for High Costs: In court, the taxpayer pays for the judge and the courthouse. In arbitration, the parties must pay the arbitrator’s fees, which can run into hundreds of dollars per hour. Some clauses even attempt to make the seaman responsible for half of this cost, creating a financial barrier to justice.
- Limited Evidence Gathering (Discovery): The rules of discovery in arbitration are often much more restrictive. This makes it harder for a seaman’s attorney to obtain important evidence from the company, such as safety records, maintenance logs, witness information, and internal investigation reports.
- Inconvenient and Costly Locations: The arbitration clause may specify that the hearing must take place in a city far from the seaman’s home such as New York, Houston, or even an international location like London or the Philippines making it prohibitively expensive and difficult for the seaman and their witnesses to attend.
- Questionable Neutrality: The pool of qualified maritime arbitrators is small. Some may handle dozens of cases for the same few vessel owners or insurance companies, raising concerns about whether they can be truly impartial when their future business may depend on generating employer-friendly outcomes.
- Finality of the Decision: An arbitrator’s award is nearly impossible to appeal. A judge in federal court must follow the law, and if they make a legal error, their decision can be appealed to a higher court. An arbitrator’s legal errors are generally not grounds for an appeal, meaning a bad decision is almost always permanent.
How Can an Unfair Arbitration Clause Be Challenged?
Just because an arbitration clause is in your contract does not mean it is automatically enforceable. An experienced maritime attorney can raise several powerful arguments to challenge the clause and keep your case in court, where it belongs.
These arguments include:
- The FAA Seamen Exemption: The first and most direct argument is that Congress specifically exempted seamen’s employment contracts from the FAA, and therefore the court has no authority to force arbitration.
- Unconscionability: This legal doctrine allows a court to invalidate a contract term that is grossly unfair. The argument can be that the clause is “procedurally unconscionable” (presented on a take-it-or-leave-it basis to a seaman with no bargaining power) and “substantively unconscionable” (its terms are incredibly one-sided, imposing huge costs and inconvenient locations).
- Violation of Public Policy: The Jones Act was enacted as a matter of public policy to protect seamen, who are considered “wards of the court.” Forcing a seaman to sign away their right to a jury trial as a condition of employment undermines this long-standing policy.
- Lack of Knowing Waiver: For a seaman to give up such an important right as a jury trial, the waiver must be clear, knowing, and voluntary. A clause buried in a lengthy employment contract often fails to meet this standard.
The success of these challenges often depends on the specific language of the clause, the facts of the case, and the jurisdiction where the lawsuit is filed. The federal courts in the Eleventh Circuit, which includes Alabama, have their own body of case law interpreting these clauses, making local knowledge of maritime law essential.
Protecting Your Rights After an Injury at Sea
If you are a seaman working under a contract that includes an arbitration clause, it is vital to act strategically after an injury to protect your rights.
- Formally Report Your Injury: Report your injury to your supervisor immediately and ensure an official accident report is completed. Request a copy for your records.
- Get Comprehensive Medical Care: Your health is the priority. See a doctor as soon as possible and be sure to describe how the injury occurred and all of your symptoms.
- Keep All Paperwork: Preserve your employment contract, pay stubs, shipping articles, and any other documents related to your employment.
- Document Everything: Write down the names and contact information of any witnesses. Take notes about the events leading to your injury while they are fresh in your mind.
- Consult a Maritime Attorney Immediately: Do not sign any additional statements, waivers, or settlement offers from your employer or their insurance company without first speaking to an attorney. An attorney who concentrates on admiralty law can analyze the arbitration clause, explain your options, and fight to keep your case in front of a jury.
The law surrounding maritime arbitration clauses is constantly evolving. Having a dedicated advocate on your side who is familiar with the latest court decisions can make all the difference in whether your case is heard in a public courtroom or a private conference room.
If you are a mariner who has suffered a serious injury at sea and are concerned about an arbitration clause in your employment contract, contact Fuquay Law Firm at (251) 473-4443 for a confidential consultation. We are committed to defending the rights of seamen and maritime workers and are prepared to navigate the complexities of admiralty law to pursue the compensation you deserve.
Frequently Asked Questions (FAQs)
What is the difference between arbitration and mediation?
Mediation is a non-binding process where a neutral third party (the mediator) helps the two sides try to reach a voluntary settlement. No one can be forced to agree. Arbitration, on the other hand, is like a private trial where the arbitrator makes a final, binding decision that resolves the case.
Can I be fired for refusing to sign a contract with an arbitration clause?
Unfortunately, in most cases, an employer can make signing the contract, including the arbitration clause, a condition of employment. Because of the limited bargaining power of an individual seaman, these are often presented on a “take-it-or-leave-it” basis.
Does an arbitration clause prevent me from receiving maintenance and cure?
No. Maintenance and cure is a fundamental, “no-fault” right under general maritime law. Your employer must pay these benefits regardless of any arbitration clause. However, if they unreasonably deny or stop your benefits, a dispute over that denial might be forced into arbitration.
If I lose in arbitration, can I appeal the decision?
Appealing an arbitrator’s award is extremely difficult. Unlike a court verdict, you generally cannot appeal just because the arbitrator made a mistake in interpreting the facts or the law. An appeal is typically only possible in very narrow circumstances, such as proven fraud or arbitrator misconduct.
Why is a jury trial so important in a Jones Act case?
A jury trial allows your case to be heard by a group of your peers from the community. They can assess the credibility of witnesses, relate to the human element of your injury, and determine what is fair compensation for intangible losses like pain, suffering, and the loss of enjoyment of life. This can be a significant advantage compared to having a single arbitrator decide these issues.
Are all arbitration clauses bad for seamen?
While most are designed to benefit the employer, a very small number of cases involving minor disputes might be resolved more quickly through arbitration. However, for any serious injury claim involving negligence or unseaworthiness, the loss of the right to a jury, limited discovery, and difficulty of appeal almost always place the injured seaman at a substantial disadvantage.
