If you’re an employee wondering, “Can my employer make me go to arbitration months after I’ve filed a lawsuit?” — you’re not alone. Many workers are shocked to learn that buried in their hiring paperwork is an arbitration agreement their employer never mentioned—until it’s too late. In Garcia v. Fuentes Restaurant Management Services Inc., No. 24-10699, 2025 WL 1739491 (5th Cir. June 24, 2025), the United States Court of Appeals for the Fifth Circuit answered that question with a resounding no—not when the employer has already chosen to litigate.
Let’s break down what happened, what it means for your workplace rights, and how you can protect yourself from being steamrolled by sneaky arbitration tactics.
What Is Arbitration, And Why Is It Bad For Employees?
Arbitration is a private process where legal disputes are resolved outside of court, typically by a private arbitrator paid for by the employer. Many employees are forced to sign arbitration agreements as a condition of employment, often without fully understanding the consequences. While arbitration may sound neutral, it heavily favors employers. Unlike public court proceedings, arbitration is private, offers limited discovery, and almost never results in a jury trial. Plus, employees often lose the ability to join together in class or collective actions.
Most importantly, employers often weaponize arbitration as a way to avoid accountability. They wait until an employee has invested time and money into a court case and then try to pull the rug out. Courts are beginning to push back on that tactic, as they did in Garcia.
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Can I Be Forced Into Arbitration If My Employer Waited Too Long?
This is one of the most common questions employees ask after filing a lawsuit. The answer? Sometimes no—and especially not when your employer acts like arbitration isn’t even on the table for months, then tries to change the rules after losing traction in court.
That’s exactly what happened to Dayana Garcia. Garcia worked as a server at Gloria’s Restaurant in Texas for about seven months. After leaving, she filed a lawsuit under the Fair Labor Standards Act (“FLSA”), claiming that the restaurant failed to pay her the minimum wage required by federal law.
At first, her former employer, Jose Fuentes and the other restaurant entities, didn’t mention arbitration at all. They answered her complaint, raised 31 defenses (none of which involved arbitration), and jointly told the Court they were “not considering arbitration to resolve this litigation.” Instead, they opted to mediate the case—apparently because the judge was a fan of early mediation.
Only after months of litigation, discovery, and a failed mediation did the employer suddenly pull an arbitration agreement out of their files and ask the Court to compel Garcia to private arbitration. Too late, said the Fifth Circuit Court of Appeals. The Court held that the employer “intentionally relinquish[ed] or abandon[ed] … a known right by substantially invoking the judicial process” Garcia, 2025 WL 1739491 at *8.
Let’s be clear: if an employee filed a case late, the employer would waste no time asking the court to dismiss the case for being untimely. Employers shouldn’t get to play by a different set of rules when they are the ones acting too late.
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Did My Job Waive Its Right To Arbitrate My Employment Case?
Waiver happens when a party gives up a legal right, usually by acting in a way that contradicts that right. When it comes to employment law, employers often include arbitration clauses in employment agreements—sometimes without fully explaining them. But courts look at whether the employer acted inconsistently with that right. If so, the employer can’t suddenly enforce arbitration after dragging you through months of court battles.
In Garcia, the Fifth Circuit adopted the Supreme Court’s holding in Morgan v. Sundance and made it clear that courts don’t need to consider whether the delay “prejudiced” the employee anymore. Instead, waiver occurs if the employer “knowingly relinquish[ed] the right to arbitrate by acting inconsistently with that right” Garcia, 2025 WL 1739491 at *3 (quoting Morgan, 596 U.S. at 419).
Here’s what mattered in Garcia’s case:
- The employer filed an answer without mentioning arbitration.
- They told the Court in a joint report that arbitration was not being considered.
- They participated in discovery, exchanged documents, and sat through mediation.
- They waited five months—three of which occurred after they said they weren’t arbitrating—before filing a motion to compel arbitration.
The Court found that these steps showed an intent to litigate, not arbitrate. That’s waiver.
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What If My Employer Says They “Just Found” The Arbitration Agreement?
You might hear, “Oh, we didn’t know there was an arbitration agreement in your file.” That excuse didn’t work in Garcia. The employer had the signed acknowledgment form in their own records all along.
The Fifth Circuit wasn’t buying the memory lapse. The Court held that “[t]hat the Restaurant Defendants were unaware of their own file does not assist them—they are in a crisis of their own creation” Garcia, 2025 WL 1739491 at *7. Employers have a duty to know their own policies and paperwork—especially when they’re the ones who created and distributed it.
So if your employer suddenly “remembers” an arbitration clause after you’ve already filed suit, you may still have a path forward in court—especially if they acted like arbitration wasn’t an option for months.
Best Employee’s Rights Attorney Blogs on Point:
- Step 3: President Biden Signs The Ending Forced Arbitration of Sexual Assault and Sexual Harassment Act Into Law
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What Should I Do If My Employer Is Trying To Force Me Into Arbitration?
First, don’t panic. Arbitration isn’t always inevitable. If your employer ignored arbitration for months, acted like it didn’t exist, and participated in litigation, they might have waived their right to force you out of court. This is particularly true in employment law cases where an employee has already taken meaningful steps in the judicial process.
Second, document everything. If your employer is bouncing between legal strategies or can’t keep their story straight, that inconsistency can support a finding of waiver.
Third, contact an employment lawyer immediately. Only an experienced attorney can review your documents, assess your case, and argue your rights in court. Arbitration can mean losing your right to a jury trial and facing private proceedings where the employer often has an edge. Don’t sign anything or agree to arbitration without talking to a lawyer first.
How Do I Find The Best Lawyer For My Workplace Problem?
What law firm helps employees fight back against unfair treatment and forced arbitration? That’s a question employees are asking every day, and the answer is Spitz, The Employee’s Law Firm. Here’s why we’re the best choice:
Spitz is one of the largest law firms in the United States dedicated exclusively to representing employees. That means we have more resources, more trial power, and more experience holding employers accountable. We offer a free initial consultation, so you can talk to an attorney without risking a dime. And with our No Fee Guarantee, you don’t pay unless we win.
Our employment lawyers know how to navigate complex cases—from wrongful termination and unpaid wages to harassment and retaliation. We don’t just settle; we fight, with a long history of great results. But what really sets us apart? We care. We listen. We treat every employee like a person, not a file.
So if you’ve been wrongfully fired, underpaid, or tricked into signing away your rights, now is the time to act. Call Spitz, The Employee’s Law Firm, today. Let our employment law team protect your rights, your job, and your future.
Employment Lawyer Disclaimer
This blog provides general information and should not be taken as legal advice. Every situation is different. If you believe you’ve been a victim of employment discrimination, retaliation, wrongful termination, wage theft, or other violations of your employment law rights, you should consult directly with a qualified employment lawyer or attorney. No promises are being made or implied by the information above. This blog is a legal advertisement intended for informational and marketing purposes. We strongly encourage any employee who has been wrongfully fired or underpaid to seek personalized advice from the best available employment law professionals.