## Facts

- Mona Gibson was rehired by Neighborhood Health Clinics, Inc. (NHC) on December 22, 1994, and reported to work on January 9, 1995.
- Before she returned, NHC implemented a new “Associates Policy Manual” and required employees to sign an “Associates Understanding” acknowledging receipt.
- The signed “Associates Understanding” required arbitration of “any and all disputes” arising out of employment and waived a judicial forum and jury trial.
- The manual (not the Understanding) included language committing NHC to arbitration and stated arbitration would proceed under the Indiana Uniform Arbitration Act.
- Gibson alleged she was asked to sign the Understanding before receiving the manual, and was told it related to time-off grievances.
- Gibson later filed an EEOC charge and brought federal claims under Title VII and the Americans with Disabilities Act (ADA).
- NHC moved to dismiss, asserting Gibson’s claims were subject to mandatory arbitration; the district court dismissed the case in favor of arbitration.

## Issues

1. Whether the Understanding and manual formed an enforceable agreement requiring Gibson to arbitrate and waive a judicial forum for Title VII and ADA claims.
2. Whether Gibson’s waiver of a judicial forum for federal statutory discrimination claims was knowing and voluntary given the documents’ content and how they were presented.

## Decision

- The Seventh Circuit reversed the dismissal and remanded.
- The court held Gibson was not required to arbitrate her Title VII and ADA claims because NHC did not show a knowing and voluntary waiver of a judicial forum.
- The court concluded the presentation and structure of the documents—particularly Gibson’s signing of the waiver without access to the manual describing the arbitration scheme—defeated enforcement of the waiver against her federal discrimination claims.

## Legal Principles

- Federal statutory employment-discrimination claims may be subject to arbitration, consistent with the Federal Arbitration Act, but only where the employee has validly agreed to arbitrate.
- A waiver of a judicial forum for Title VII and ADA claims must be knowing and voluntary, assessed in context, including the clarity of the waiver and the circumstances of execution.
- When an employee signs only an acknowledgment containing the waiver, but the employer’s reciprocal obligations and arbitration procedures appear in a separate manual not provided until after signature, the employer may fail to establish meaningful notice and assent sufficient to enforce arbitration of federal statutory claims.
- Courts may apply ordinary contract principles informed by the need for clear notice when enforcing waivers affecting access to a judicial forum for anti-discrimination rights.

## Conclusion

The court held that the employer could not compel arbitration of Gibson’s Title VII and ADA claims because the handbook-acknowledgment waiver, presented for signature before Gibson received the manual detailing the arbitration program, did not demonstrate a knowing and voluntary waiver of her right to litigate in federal court.


Gibson v. Neighborhood Health Clinics, Inc., 121 F.3d 1126 (7th Cir. 1997)