Michigan Standard Employment Forms May No Longer Hold Up in Court: 2 Steps Employers Should Take Now
The Michigan Supreme Court just ruled that many boilerplate forms employees sign on day one – sometimes known as adhesive employment agreements – are no longer automatically enforceable if they shorten the timeframe for filing legal claims. The July 31 decision in Rayford v. American House Roseville I, LLC , held that such agreements will now be scrutinized under a “reasonableness” test. How did we get here, and what should Michigan employers do now? Below, we’ll walk you through the backstory, break down the Court’s holding, and offer two key action items to help your organization. How Did We Get Here? Until now, Michigan courts largely enforced employment handbooks, applications, and standalone agreements containing a 180-day deadline to file legal claims (which cut sort the standard three-year statute of limitations). That approach stemmed from two appellate rulings in 2005 that held these terms were fine so long as they were clear and no other contract defense applied....