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Forced arbitration bill introduced in U.S. Senate

On Behalf of | Mar 3, 2016 | Employment Disputes |

When employment disputes arise, employees hope to use existing Minnesota and federal laws to help them prove and win their cases in a court of law. However, the widespread use of mandatory arbitration clauses in employment contracts has made it increasingly difficult for everyday people do so.

Instead of receiving a trial overseen by judges and decided by juries, a large majority of these disputes are being pushed into arbitration, where corporations may have a distinct advantage. Due to the nature of arbitration, many arbitrators may come to view the companies that are involved as their clients, which can have a serious effect on the arbitrator’s ability to remain impartial throughout a case.

If passed, a new bill that was recently introduced in the U.S. Senate could seriously impede corporations’ ability to enforce these forced arbitration clauses in the future. The law would make it illegal for businesses to require employees and customers to accept the arbitration clauses when they really have no choice but to do so.

Businesses would thus be prohibited from making people forgo their legal right to litigation. Instead of having their cases immediately thrown into arbitration after a dispute arises, all involved parties would have to agree to use an arbitrator as a way to resolve the issue. While consumers may see a particular benefit from the new law, it will also have a distinct impact on employment disputes that arise from actions like wrongful termination and sexual harassment.

Employment disputes are often complicated matters that can be difficult to navigate without help. People may find it beneficial to seek the guidance of an attorney so they can learn their options and how to go about defending their rights in these situations.  

Source: Los Angeles Times, “Government may soon begin putting an end to forced arbitration clauses,” David Lazarus, Feb. 26, 2016.



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