Final answer:
Businesses typically prefer mandatory arbitration clauses to reduce legal costs and avoid lengthy court battles. These clauses offer a more efficient and private way to handle disputes than traditional litigation, while also minimizing unpredictability and potentially leveraging arbitrators with subject-matter expertise.
Step-by-step explanation:
The primary reason that businesses favor the use of mandatory arbitration clauses to resolve customer disputes is A) To reduce legal costs and avoid lengthy court battles. These clauses are often included in contracts because they can provide a more efficient, cost-effective, and private means of resolving disputes compared to traditional litigation. They help businesses control legal expenses and minimize the unpredictability associated with public court trials. Moreover, arbitration can be less formal, faster, and conducted by arbitrators who have specific expertise in the area of dispute.
The ethical considerations of mandatory arbitration clauses in employment contracts include fairness, transparency, and the rights of the employee.
First, it is important to consider whether the arbitration process is fair to both parties. This includes considering the qualifications and impartiality of the arbitrator, the ability of both parties to present evidence, and the potential for unequal bargaining power between the employer and employee.
Second, transparency is an important consideration. This includes ensuring that both parties are aware of the arbitration process and the potential outcomes, and that the arbitration process is conducted in a transparent manner.