How Advisors Can (And Should) Face Employment Disputes

Employment disputes span a wide range of legal issues, including breach of contract, wrongful termination, fraud, defamation, discrimination, and more. 

The vast majority of rep agreements dictate that disputes that arise between the advisor and employer must be handled via a specified arbitration forum. That forum can be either FINRA’s dispute resolution forum or another private arbitration forum. Employers typically require an arbitration provision in employment contracts in order to keep legal costs down and force reps into what employers typically view as an employer-friendly forum. The fact that the bulk of employment attorneys practicing in the United States have not dealt with an arbitration under FINRA rules places the employer at an advantage. 

While employers favor employer-friendly arbitration, there are several types of employment discrimination cases that, per federal law, are always able to be brought in state court or in front of the Equal Employment Opportunity Commission (EEOC). Those cases include discrimination based on race, religion, sex, national origin, disability, and age (for those over 40). When it comes to dispute resolution for discrimination cases, there are various potential avenues available for advisors to pursue.

Certain types of cases should be heard at arbitration, either through FINRA or another forum. One common example of such a case is that in which an advisor is seeking expungement of a termination disclosure. When expungement is among the remedies being sought, the case is best handled by a team that’s well versed in arbitration.  

Advisors with employment issues that need to be resolved through a legal procedure should be sure to consult with an experienced legal team that’s familiar with the landscape of the financial services industry. Sticking with a firm that represents advisors exclusively will ensure that your needs are at the forefront. 

For a complimentary consultation about your employment issue, reach out to AdvisorLaw. 


AdvisorLaw’s services were created exclusively for financial advisors and wealth managers.