On May 12, 2015, in Ashbey v. Archstone Property Management, Inc., the US Court of Appeals for the Ninth Circuit held that an employee knowingly waived his right to a judicial forum for his Title VII claim where the acknowledgment that he expressly signed on receipt of the defendant's Company Policy Manual explicitly provided notice of the company's Dispute Resolution Policy that included the waiver (No. 12–55912, (May 12, 2015)).

Twice during his employment with Archstone Communities LLC (Archstone), Michael Ashbey signed a document acknowledging receipt of Archstone's Company Policy Manual, which included two explicit references to the company's Dispute Resolution Policy. The Dispute Resolution Policy detailed Archstone's arbitration clause requiring all disputes, including claims arising under the Civil Rights Act of 1964, to be governed by the Federal Arbitration Act (9 U.S.C. § 1 et seq.) (FAA) and to be resolved by an arbitrator through final and binding arbitration, not in a judicial forum.

In November 2011, Ashbey filed a complaint in California state court alleging, among other things, unlawful retaliation in violation of Title VII of the Civil Rights Act of 1964 (42 U.S.C. § 2000e et seq.). Archstone removed the case to federal district court on the grounds of both diversity of citizenship and federal question jurisdiction, and then filed a motion to compel arbitration under the company's Dispute Resolution Policy. The district court denied the motion on the ground that Ashbey did not knowingly waive his Title VII right to a jury trial. Archstone appealed.

The Ninth Circuit reversed the district court, holding that Ashbey knowingly waived his right to a judicial forum for his Title VII claim. The appellate court acknowledged that the scope of the FAA is narrowed by federal statutes such as Title VII, but stated that a plaintiff could waive his right to a judicial forum if he did so knowingly. The court noted that the acknowledgment here explicitly notified Ashbey in two places that the company's Manual contained a Dispute Resolution Policy, and Ashbey expressly agreed to adhere to the Manual and Dispute Resolution Policy. The court found that it was not fatal that the acknowledgment did not list the terms of the Dispute Resolution Policy because Ashbey acknowledged that he received directions on how to access the company's Manual and Dispute Resolution Policy. The Ninth Circuit distinguished the acknowledgment signed by Ashbey from those at issue in previous cases by pointing to the express choice given to Ashbey but lacking in the other cases.

Practitioners in the Ninth Circuit should be aware that an arbitration clause incorporated into a company's policy manual will not be upheld unless the employee is provided with explicit notice of the company's policy on dispute resolution.