Establishing secure connection…Loading editor…Preparing document…

Mandatory Arbitration Agreement

This template is fully customizable. Edit the text, fill out the fields, and send it for signature. Give it a try!

VOLUNTARY BINDING ARBITRATION PROGRAM APPLICATION

vs.

Attorneys:

Panel selected to decide case:

hours

Issue(s) to be submitted for decision:

State any stipulations of facts or other agreements on attached sheet.

We agree to submit the foregoing case to a binding, non-appealable decision by the above named panel and have the authorization of our clients to do so. We hereby certify that all discovery is complete and this matter is ready to be submitted to arbitration. Attached is a consent order of dismissal with prejudice.

(submit completed form to the arbitration administrator and a hearing will be scheduled)

CN 10738-English page 1 of 1
Enter text✕
Prepare your document for signing right on this page
  • 01 Edit the text and complete the fields
  • 02 Click Sign Now and on the next screen add recipients and signature fields in SignNow
  • 03 Start your free trial to sign and send your doc
Sign Now

What a Mandatory Arbitration Agreement Is and When It Applies

A Mandatory Arbitration Agreement is a contract clause that requires parties to resolve certain disputes through arbitration instead of court litigation. It typically defines scope, rules, venue, and whether class actions or collective claims are permitted. These agreements are common in employment, consumer contracts, and commercial agreements and must be drafted to reflect applicable federal and state law, including ESIGN electronic execution rules when signed digitally.

Why Parties Use a Mandatory Arbitration Agreement

Mandatory arbitration can reduce courtroom exposure, shorten dispute timelines, and create a private process for resolving claims. Properly drafted clauses clarify procedures, allocation of fees, and choice of arbitrator rules to limit uncertainty while preserving enforceability under U.S. law.

Why Parties Use a Mandatory Arbitration Agreement

Who Commonly Includes Mandatory Arbitration Clauses

Organizations and counsel include these clauses to manage dispute resolution risk and cost across recurring transactions and employee or customer relationships.

  • Employers and HR teams use them in offer letters and employee handbooks to set a single dispute process for workplace claims.
  • Consumer-facing businesses place clauses in terms of service, purchase agreements, and subscription contracts to limit litigation risk.
  • Legal departments and outside counsel add arbitration definitions and rules to reduce uncertainty and specify procedural mechanics.

Use legal review to confirm mutuality, clear procedural language, and compliance with federal and state consumer protection rules before deployment.

Typical Signers and Their Roles

Company Signatory

Chief Legal Officer or authorized business representative signs on behalf of the company — must have authority to bind the organization and should reference corporate authorization or board resolution when applicable.

Individual Signer

Employee, customer, or counterparty signs in a personal capacity; identity must match contract metadata and any authentication method used during electronic signing to ensure enforceability.

Core Elements to Include in a Professional Mandatory Arbitration Agreement

A complete clause names parties, defines covered claims, sets rules and forum, addresses fees and remedies, and confirms signature and amendment mechanics.

Parties

Identify each contracting party by full legal name, business type, and principal address to avoid ambiguity about who is bound.

Covered Claims

List claim types subject to arbitration (e.g., contract, tort, statutory claims) and state any exceptions, such as small-claims court or injunctive relief carve-outs.

Arbitration Rules

Specify an administering body (e.g., AAA, JAMS) or ad hoc rules, and identify the edition of rules that will govern proceedings.

Location and Procedure

Set the seat of arbitration, number of arbitrators, and whether hearings may be remote or require in-person attendance.

Class Action Waiver

State clearly whether class, collective, or representative actions are prohibited or permitted, mindful of state and federal enforceability limits.

Costs and Fees

Allocate responsibility for filing fees, arbitrator fees, and counsel costs; consider fee-shifting language consistent with applicable statutes.

Step-by-Step: How to Prepare and Execute the Clause

Follow these sequential steps to ensure the clause is complete, enforceable, and properly executed either on paper or electronically.

  • 01
    Draft: Define parties, covered claims, rules, and carve-outs in plain language to reduce ambiguity.
  • 02
    Review: Have counsel confirm mutuality and compliance with federal and state consumer or employment statutes.
  • 03
    Select Signing Method: Choose in-person notarization, RON, or eSignature; ensure method meets ESIGN/UETA requirements.
  • 04
    Execute & Store: Obtain signatures, record audit trail, and retain executed copies in secure records with appropriate retention tags.

How to Configure an Online Signing Workflow

Configure signers, authentication, and routing so the clause is presented clearly and each signature event is auditable.

Field Configuration
Signature Method E-signature with audit trail or RON for notarized execution
Authentication Email link, SMS code, or stronger multi-factor where identity needs verification
Routing Order Sequential or parallel signer order with reminder cadence
Retention Automatic storage in secure repository with exportable audit log

Where to Send or File the Executed Agreement

After execution, route copies to legal, HR, records, and any administering arbitration body as needed to begin proceedings.

  • To Counterparty: Deliver fully executed copy to the other party and retain proof of delivery
  • To Records: Store the signed agreement in the contract repository with audit metadata
  • To Arbitration Provider: File with the selected administering body only if initiating a claim
  • To Counsel: Share executed version with outside counsel for dispute-preparedness

Technical and Platform Considerations for Electronic Execution

Choose a platform that provides a complete audit trail, secure storage, and appropriate signer authentication methods.

  • Formats: PDF, DOCX, and stored audit logs
  • Integrations: CRM and document repository connectors available
  • Authentication: Email, SMS, KBA, or SSO for added identity assurance

How a Mandatory Arbitration Agreement Differs from Similar Clauses

Compare arbitration clauses with mediation clauses and general dispute resolution language to select the right approach for your contracts.

Aspect Arbitration Agreement Mediation Clause
Binding usually non-binding
Formality formal tribunal process informal facilitation
Appeal Rights very limited preserved in court
Typical Cost higher (arbitrator fees) lower (mediator fees)

Select eSignature Vendor Comparison for Executing Arbitration Agreements

Platform choice affects authentication, audit trail quality, and integration. The table below compares signNow with common alternatives on price and key capabilities.

signNow DocuSign Adobe Sign PandaDoc HelloSign
Starting Price $8/user/mo $15/user/mo $14/user/mo $19/user/mo $15/user/mo
Free Trial Yes, 7-day trial Yes, trial available Yes, trial available Yes, trial available Yes, trial available
Bulk Send Yes Yes Yes Yes No
Audit Trail Yes Yes Yes Yes Yes
HIPAA Compliant Yes Yes Yes No No

Essential Security and Compliance Considerations

Intent Evidence: Record of signature intent
ESIGN/UETA: 15 U.S.C. §7001; UETA adoption
HIPAA (when applicable): BAA required for PHI
Audit Trail: Timestamp, IP, signer actions
Encryption: TLS 1.2/1.3; AES-256 at rest
Access Control: Role-based permissions

Risks and Consequences of a Defective Arbitration Clause

Unenforceability: Clause invalidated
Class Litigation: Class waiver struck down
Regulatory Scrutiny: State consumer protection action
Increased Costs: Higher litigation expenses
Delay: Proceedings remanded to court
Reputational Harm: Consumer trust damage

Common Drafting and Execution Mistakes to Avoid

  • Vague scope language that fails to describe which claims are covered, inviting a court to rule the clause ambiguous and unenforceable.
  • Including a class-action waiver without considering state law restrictions or recent judicial decisions that may limit enforceability for consumers.
  • Failing to obtain clear consent to electronic terms under ESIGN (15 U.S.C. §7001), including the required consumer disclosure when applicable.
  • Using multiple conflicting clauses or inconsistent venue and governing law provisions that create grounds for procedural challenges.

Timing Considerations and Typical Deadlines

Track effective dates, notice and opt-out windows, and any arbitration provider filing timelines to avoid waiving rights or creating procedural defects.

Effective Date:

Agreement becomes binding on the stated MM/DD/YYYY effective date

Opt-Out Window:

If offered, common commercial practice uses a 30-day opt-out period

Provider Filing:

Arbitration provider filing timelines vary by forum

Statute of Limitations:

Substantive limitation periods are unaffected unless expressly stated

Record Retention Start:

Retention begins on execution date or last effective amendment

Real-World Examples of Online Execution and Use

These brief case summaries illustrate how organizations use electronic signature platforms to execute arbitration clauses and maintain compliance.

Optica Ventures LLC

The interface is simple and easy-to-use for our team; more importantly, it is just as easy for our customers.

  • Quick integration with existing workflows reduced turnaround.
  • Optica retained full audit trails and reduced paperwork while ensuring each agreement recorded signer identity and timestamp for enforceability.

Martin Properties

I can process and execute all of these documents online with 100% compliance and built-in security.

  • Mobile and offline signing available.
  • The company reduced closing delays by centralizing executed agreements and storing them with searchable metadata to support dispute preparedness.

Common Questions About Mandatory Arbitration Agreements

Answers to frequently asked questions address enforceability, electronic execution, opt-outs, and recordkeeping to reduce common post-execution disputes.


Need help? Contact support

Explore Templates

Indiana Death Deed Georgia LLC Living Will Form Quitclaim Deed Gift Deed California Deed of Rescission
be ready to get more
Join over 28 million airSlate SignNow users
Sign Now
Company
Forms
Pricing
Resources
Knowledge base
Other Products
© 2026 airSlate Inc. All rights reserved.