October 28, 2009
Ending Corporate Abuse: Forced Arbitration
Read the report by Public Citizen – Forced Arbitration: Unfair and Everywhere (PDF).
FairArbitrationNow.org launched to highlight, bring end to the abuse
Forced arbitration is giving up your right to go to court if you are harmed by a company. Under forced arbitration, any dispute you have with a company is handled by a third party that doesn’t have to follow the law, doesn’t have to publish their findings for public review, and depends on the company’s referral for its business.
Forced arbitration is not only unfair, it’s everywhere, according to a report released in September 2009 by Public Citizen:
In forced arbitration, consumers lose the right to go to court to settle disputes with businesses. Instead, they must go before private tribunals that are chosen by businesses and compete with one another to satisfy these business clients. In addition, arbitration is usually conducted in secret, often imposes onerous costs on consumers, and provides extremely little opportunity for meaningful appeal (even when a ruling ignores the law). [emphasis added]
You’re likely already bound by forced arbitration agreements if any of the following apply to you: you have a cell phone, a job, a bank account, or student loans, you go to a doctor, you plan to buy a car or build a new house, you have a relative in a nursing home, you pay for cable or satellite TV – the list goes on and on.
Many of the laws passed to protect consumers from negligence and employees from violations of their civil rights are unenforceable under binding arbitration.
The Solution: Banning forced arbitration
The Arbitration Fairness Act is legislation introduced in the 111th Congress which would outlaw forced arbitration in consumer agreements and employment contracts. Arbitration should be a choice, and the Arbitration Fairness Act would restore that choice for American consumers and employees. Specifically, the Act:
Declares that no predispute arbitration agreement shall be valid or enforceable if it requires arbitration of: (1) an employment, consumer, or franchise dispute, or (2) a dispute arising under any statute intended to protect civil rights.
Declares, further, that the validity or enforceability of an agreement to arbitrate shall be determined by a court, under federal law, rather than an arbitrator, irrespective of whether the party resisting arbitration challenges the arbitration agreement specifically or in conjunction with other terms of the contract containing such agreement.
Exempts from this Act arbitration provisions in collective bargaining agreements.
Three things you can do to end forced arbitration
- Sign the petition to end forced arbitration.
- Call your member of Congress and tell him/her to support the Arbitration Fairness Act.
- Join the opposition to forced arbitration.
Learn more about forced arbitration in various sectors of the economy and about our campaign to end it at www.FairArbitrationNow.org.