Forced arbitration, which has been eroding our rights for too long, is finally suffering a long-overdue correction. The #MeToo era has made it impossible to justify why workers should be forced to sign away their rights to pursue sexual harassment claims in court. This development deserves to be followed by a move to put all of the “fine print,” which so often characterizes forced-arbitration clauses, under the microscope.
Just this month, five tech-sector companies—Google, Facebook, Square, Airbnb and eBay—announced they would stop forcing workers to settle sexual harassment claims through private arbitration. Now workers at those businesses will be able to pursue their claims in court, the way the law was originally designed to work.
They join Uber and Lyft, companies that announced in May that their customers who were the victims of sexual assault or sexual harassment would no longer be required to pursue allegations against their employees through arbitration. Last year Microsoft eliminated forced arbitrations in these cases.
For employees, getting their rights back is a no-brainer. In September, the online social network Blind surveyed more than 5,500 tech sector workers. They found 71.5 percent of those workers wanted their companies to end forced arbitration provisions in their employment contracts—not only for sexual misconduct complaints, but for any reason whatsoever.
And that’s exactly the point. For decades, a growing wave of forced arbitrations has been quietly stealing the rights of hundreds of millions of employees and consumers across the country. Many everyday agreements for products, services and jobs include fine print that says when you are harmed, that any claims you may have must be sent to a decision-maker chosen by the company that wronged you.
Forced arbitration agreements accompany many of the contracts and terms of service found on the internet or in consumer agreements every day. Most people just don’t know what they’re signing when they buy a cellphone, get a loan, obtain a credit card, or click “I agree” to a company’s terms and services online. Very few even bother to read what they are agreeing to.
It’s disturbing, but not exactly a surprise, that arbitrators chosen by companies rule for businesses over consumers 94 percent of the time. As former Secretary of Labor Robert Reich says, “It’s a rigged system that helps companies evade responsibility for violating antidiscrimination, consumer protection and public health laws.”
These arbitrators are not required to follow precedents and standard procedures. Their decisions are final and can’t be appealed. If you lose your case, the arbitrator can make you pay large fees to the company that wronged you. And not only that, the proceedings are often secret, even when they raise important issues the public and other workers would care about. That lack of transparency means that even when a victim comes forward to report an abuse, their colleagues are still vulnerable to being abused in the same way.
Forced arbitration clauses deprive Americans of two of their most important rights: the right to decide whether to go to court, and the right to be judged by a jury of their peers. And they often bar consumers from banding together to seek justice through class-action lawsuits.
For decades, AFJ has made fighting forced arbitrations one of its top priorities. Every American deserves access to justice, and an even playing field that isn’t tilted towards big business.
When AFJ produced its film “Lost in the Fine Print,” we highlighted the stories of everyday people who found themselves trapped in a system that favors large and powerful companies at the expense of hardworking Americans.
One of these people was Nicole Mitchell, a highly-decorated Air Force reserve officer who worked as an on-air personality for The Weather Channel. She was fired because her employers didn’t want to provide her with reasonable accommodations to do both, as promised by law.
Because her employment contract contained a forced arbitration clause, Mitchell couldn’t make her case in court. Instead, she lost her job to a decision of an arbitrator she never even met—and her employment contract deprived her of the right to even appeal the arbitrator’s decision in court.
Mitchell’s case is emblematic of the experiences of many workers who have found themselves powerless at the hands of arbitrators. And while it took several horrific and high-profile cases of sexual harassment to grab the headlines and make forced arbitration increasingly unacceptable, it’s clearly time to put a stop to forced arbitration in a whole range of employment disputes.
And that’s why persistent public pressure is so important—to bring injustice into the light of the day, so that our leaders are forced to pay attention and take steps to restore our rights. AFJ supports the Arbitration Fairness Act, a bill introduced in Congress in 2016 that would prohibit forced arbitration in the consumer, employment, civil rights and antitrust contexts.
We also support the Court Legal Access and Student Support (CLASS) Act, which targets the use of forced arbitration by colleges, which have too often allowed for-profit educational institutions to avoid accountability for loan fraud, school closures without granting credentials or degrees, and misleading recruitment and enrollment tactics.
Finally and most recently, we have joined with other advocacy organizations in supporting the Restoring Justice for Workers Act, which would overrule the Supreme Court’s harmful decision in Epic Systems v. Lewis by ending forced arbitration clauses and protecting the ability of workers to pursue work-related claims in court.
This month’s good news is worth celebrating. But the battle to restore our rights is far from over.