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Legal Memorandum: Arbitration Agreements in Employment Contracts

Issue: Does the Federal Arbitration Act pre-empt the Virgin Islands statute relating to arbitration agreements in employment contracts?

Area of Law: Alternative Dispute Resolution, Business Organizations & Contracts, Employee Law
Keywords: Employment contract; Arbitration agreement; Preempted by FAA
Jurisdiction: Federal
Cited Cases: None
Cited Statutes: 24 V.I.C. § 74a
Date: 11/01/2004

 

In Gov’t of the V.I. v. deJongh, 28 V.I. 153 (D.V.I. 1993), the district court concluded that “[s]tate laws chosen by the parties to govern an agreement will only be pre-empted by the Federal Arbitration Act (“FAA”) where such state laws render agreements to arbitrate unenforceable.”  Id. at 160.  Far from rendering agreements to arbitrate unenforceable, the statute relating to arbitration agreements in employment contracts, 24 V.I.C. § 74a, simply provides a procedure by which such agreements may be enforced in the Virgin Islands. 

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