Promoting Informed Use and Best Practices for ADR in Washington
The Arbitration Fairness Act of 2009 is pending in both the Senate and the House. S931 is in the Senate Judiciary Committee and HR1020 is pending in the Commercial and Administrative Law Subcommittee of the House Committee on the Judiciary.
The Act, if passed, would overturn the 5-4 Supreme Court decision in 14 PENN PLAZA LLC v. PYETT, 556 U.S. ___ (2009), 129 S. Ct. 1456, upholding arbitration clauses in collective bargaining agreement employment contracts waiving an employee's right to bring statutory claims in federal court. The Act would also overturn the 5-4 decision in CIRCUIT CITY STORES, INC. V. ADAMS, 532 U.S. 105 (2001), approving mandatory arbitration agreements of employment law disputes in lieu of litigation.
The proposed Act invalidates pre-dispute mandatory arbitration agreements in employment, consumer, franchise, or civil rights disputes. Support for the Act appears to be growing. The North American Securities Administrators Association supports the Act, although there is some stiff opposition, including the International Franchise Association.